The FT said this in the last sentence of a long wrap-up of Asian markets, a story that the early editions of the WSJ have not mentioned at all, but appears pretty noteworthy to us:

the Shanghai Composite index rose above 5,000 for the first time to finish 1.1 per cent higher at 5,032.49.

The Shanghai market has almost doubled in the last six months alone. It is now trading at almost 60x earnings. It was only at 1500 a little more than a year ago, more than tripling in a year. Chinese authorities attribute its bubble-less rise to the “brilliant policy decisions” of government authorities.

So just as the US markets get pummeled by a real estate bubble, China is living a dream version of the Roaring Twenties, with great wealth creation and urban migration. Oddly enough, this pattern of a big real estate bubble in the US and a wild run-up in global stock prices has happened before. No doubt it’s just a coincidence, however.

This entry was posted on Thursday, August 23rd, 2007 at 2:19 am and is filed under business, China, General. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.