It’s the first trading of the New Year at Shenyin Wanguo stock brokerage house in Shanghai. A gray haired man everyone calls ‘Old Chen’ watches stock prices along the floor-to-ceiling trading board. On the Shanghai stock exchange, red numbers -a symbol of communism- are good. Green numbers mean share prices are falling. "Look at the board!" screams Chen. "It’s the first day of the year and it’s all green! This is a casino - A communist party casino! We can’t possibly win against them. I gotta stop coming here," he mutters, still staring at the board.
This is not the response from investors China’s government was hoping for when they reopened the market to new listings. Securities analyst Qian Qimin says China will have to do a lot more to restore investor confidence. "The rate of return investing in stocks in China is lower than the bank deposit rate," says Qian. "Insider trading also continues to be a big problem."
Back on the trading floor, trader Jin Demin says investing in stocks in China is hopeless in a country where the markets are controlled by the state. Jin says when US stocks go up, China’s drop. When US stocks drop, China’s drop further.