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Bubbles, Balloons, Needles, And Pins

• Zero Hedge - Tyler Durden

GDP growth was disappointing at 6.5%, but whoever believed those almost always dead on numbers? It would be way more interesting to know what part of that growth has been based on debt and leverage. But that we don't get to see.

So we turn elsewhere. How about the Shanghai Composite Index? It may not be a perfect reflection of the Chinese economy, no more than the S&P 500 is for the US, but it does raise some valid and curious questions.

Borrowing from Wolf Richter, here are some stats and a graph::

Lowest since November 27, 2014, nearly four years ago

Down 30% from its recent peak on January 24, 2018, (3,559.47)

Down 52% from its last bubble peak on June 12, 2015 (5,166)

Down 59% from its all-time bubble peak on October 16, 2007 (6,092)

And back where it had first been on December 27, 2006, nearly 12 years ago.

The first thing I thought when I saw that was: how on earth is it possible that in an economy that's supposedly been growing 6%+ for a decade, stocks have gone nowhere at all? And obviously the role of the Shanghai index is different from that of the S&P, the DAX or the FTSE, but at the alleged Chinese growth rate, the economy would have almost doubled in size in 10 years. And none of that is reflected in stocks?

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