The Daily Cow

Last Friday, the Shanghai index hit another 52-week low of 2695, off nearly 60% from its peak of 6124 reached last November. It took the NASDAQ just as long to fall exactly that much, and after falling 60%, it fell 20% more to the 1100s. The Shanghai market was highly inflated and over-speculated last fall, but unlike the NASDAQ in the dot-com boom and bust, the companies listed in the Shanghai index actually earn reputable profits compared to those that collapsed with the NASDAQ in the early 2000s.

The Shanghai index will climb back up in the near future--not necessarily as high as 6124, but definitely into the 3000s. But for now, the immediate future is uncertain as inflation soars above 8% in China, global energy prices skyrocket above reasonable levels, and China's central government tightening money supplies to soak up excess liquidity.