Chinese Farmer Loses Life Savings
Given the remarkable increase in the number of stock trading accounts and soaring margin debt in China over the last year or two, stories such as the one below about a farmer losing his life savings (and then some) should be expected, but, after seeing this man’s distress and learning of the dollar amounts and approach involved, it is a little surprising.
Investing his entire stake of $164K in one company and then being extended $1 million in margin probably weren’t the best moves Yang Cheng could have made.
Clearly, the government should have provided some basic instruction about investing in stocks when they began their effort to promote stock ownership. Maybe they did and he thought he knew better – the only thing missing from this sordid tale is the claim that Yang Cheng at one point was worth $4 million, or something like that.
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