From Chinese Press

Beware of speculators

(China Daily)
Updated: 2010-04-23 08:32

Speculation must be regulated in order to ensure economic stability, says an article in People's Daily. Excerpts:

Large amounts of "hot" money are pouring into some areas of Southeast China, seeking to profit from crop failures caused by the recent drought.

Speculators target a shortage in one sector or another of the economy and hope to drive up prices. The soaring price of housing in first-tier cities is only the most recent example. Excessive capital investment is detrimental to the nation's economy. Inevitably, a bubble follows the injection of "hot" money.

When the bubble bursts, it is followed by a slump in prices and chaos in the market. The authorities should pay close attention to financial markets and assure full disclosure of commodity supply, demand and price. When necessary, they should respond quickly to incidents of speculation, according to the law.

(China Daily 04/23/2010 page9)