Has China Turned the Corner on Its Economy?
China stocks rally and hedge funds notch huge gains as Xi finally grapples with the country’s long slump.
Bullish in Shanghai.
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“Being bearish about China is one of the most popular trades,” Shuli Ren wrote in her column this week. But that notion was tested this week as hedge funds with big bets in the People’s Republic saw upwards of 25% returns after President Xi Jinping issued several measures to stimulate the sluggish economy. After a year of ideological strictures, including telling young people to work harder and “eat bitterness,” Shuli says, “It’s clear that top leaders have finally realized what is really ailing China, and why past measures have not worked.” The markets appear to be enthralled that the top echelon of the ruling Communist Party is grappling with the problem seriously. The stimulus arrived just before China’s Oct. 1 National Day — and the beginning of a weeklong holiday. Here’s how John Authers charted the exhilaration: