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Earnings, IPOs, and the like

by Joseph Weisenthal

Mon, May 14th 2007 4:41pm





In China, IPO Mania In Full Force

from the spike-it dept

Although the IPO market in the US has come strongly back to life, there's still no sign that things are wildly overheated like they were during the bubble. Although profit-less companies are managing to go public, investors seem to be discerning between quality and junk once the shares begin trading. But, if you're looking for a wild IPO market, check out what's going on in China these days. New offerings in Shanghai are routinely seeing massive first-day spikes, just like dot come stocks 7 years ago. Of course a rash of these deals signifies an inefficient market, as the newly public companies leave a lot of money on the table. On the other hand, public market investors go crazy over these spikes, because they look like instant wealth creation. And in China, going crazy they are, as the stock market has become a national obsession, with people taking on massive personal leverage in order to invest. So while things may look okay here, from a global perspective, there are signs of madness once again.

4 Comments | Leave a Comment

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  •  
    identicon
    DCX2, May 15th, 2007 @ 8:34am

    Hm...

    I wonder if the Chinese IPO market is exploding because of all the debt that the US is buying from China...

     

    [ reply to this | link to this | view in chronology ]

  •  
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    BigDogDallas, May 15th, 2007 @ 8:47am

    1.3 billion people...that many more fools.

     

    [ reply to this | link to this | view in chronology ]

  •  
    identicon
    Bill, May 16th, 2007 @ 5:31am

    bubbles

    Didn't you guys just have an article about how bubbles are good? There's probably lots of fraud going on here but hopefully also lots of lasting companies are being formed. People in China have few investment options. They can't invest outside of China. Chinese investors will soon learn about bubbles.

     

    [ reply to this | link to this | view in chronology ]

  •  
    identicon
    Maureen McEachen, Jul 3rd, 2007 @ 12:03am

    Chinese Anyone????

    So, trading IPO's in the Shanghai Stock Exchange may be a stretch for most of us. Maybe I'll get an Interactive Brokers account and let them do the talking...

     

    [ reply to this | link to this | view in chronology ]


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