Last year, I wrote an article on my thoughts about why 2016 is going to be a year of economic crisis, here. The horror just happened! Today, the Shanghai Index showered with blood over weak manufacturing data.
I do have a lot of trashes I wanna throw about the Chinese investors. Generally, I believe that most of us do have strong gamblers mindset. Therefore, most Chinese investors believe in myths, feng shui, luck and etc. We tend to follow the crowd, and very less likely to analyse something by ourselves. Therefore, we are tend to create a snowball effect.
When the market is doing good, we tend to go all in, because we "kiasu", scared of loosing that fresh piece of pie. When the market started to go not so well, we pull off, becasue we generally "kiasi", scared of losing big. Therefore, Chinese investors are generally dictated by fear. Generally are the fear of not earning more than others, which is "greed". And also fear of losing big.
As most of the people in the financial market knows that the element of greed and fear is the evil factor which will cause all the disaster and financial crisis. It is clear, when you compare a western gambler to chinese gambler. You'll notice that the western gambler bet and play for fun, and still able to pull himself off once he was satisfied by the excitement he is looking for. However, the chinese gambler bet and play, expecting a sure win result, get himself deeper and deeper into the trap, until he loses all he have.
2016 just mark the beginning of the crisis. Lets pray.
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