Shanghai Stocks Fall Amid Bankruns in China

bank run china july 2020

Shanghai’s Composite Index has dropped by 10% this week, much of it in the past two days, falling from about 3500 to now 3200. That’s after a mini bull run as the beginning of the month, probably due to hopes of economic recovery with it now again just about growing in China. But after some brief sideways, stocks seem to have turned: The reason for this fall is probably because of concerns regarding the health of the banking system in China which appears to be under some pressure. The government there ordered banks last month to sacrifice $212 billion (70% of their profits) to help boost the economy according to a local paper. Then more recently Trump signed a bipartisan bill to sanction high ranking Chinese officials over their treatment of muslim and ethnic turkish minorities. That law has punitive measures against banks that do business with sanctioned officials, including…

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