Blowing Chinese Bubbles

The Chinese central bankers are making some moves to stop the Chinese bubble. Their stock market is up a whopping 55% this year and is showing all the signs of a gold rush.

The Chinese economy and stock market have been booming, going up in a virtual straight-up fashion. Investment money is pouring into their markets at a breakneck pace and inflation is at unacceptably high rates. The above link outlines some significant steps they've taken today to slow things down.

Why should we care?

Because to a large extent the Chinese boom is powering the international economic boom. It was a Chinese "correction" in February that was blamed for tanking the U.S. stock market. As I write this, our markets are not showing any signs of distress. But today is an expiration day (nevermind) which tends to create a lot of "noise" in the stock market. Next week should be very interesting.