Regulate with a Big Stick, Not a Fly SwatterChina's securities regulators should focus on sound oversight and tough discipline to protect, not merely stabilize, the market.
Three cases that came to light during the second week of May drew attention to regulatory efficiency and tight enforcement in the securities market. A former president of China Galaxy Securities, Xiao Shiqing, was arrested May 13. That same day, Sinolink Securities (SSE: 600109) announced that its chairman, Lei Bo, had been placed under investigation. And a day later, Rongtong Fund Management booted fund manager Zhang Ye for suspected involvement in so-called "rat trading."
On the surface, these cases seem unrelated. Each involves a different context. But deep down, each is connected to how regulatory agencies shoulder their responsibilities. And now, once again, concerns have been raised about regulatory oversight and regulatory capture.
Securities legislation protects investors
Small investors' interests are high on the agenda in the revision of China's Securities' Law, which will be deliberated by China's legislature later this year.
But the country's legal system still needs improvement to enable investors to make full use of the Securities Law, including taking steps like "collective action" against listed companies that cheat, said a senior lawmaker.
China Spends 61.2% of 2009 Investment Budget
The central government has already spent 61.2 percent of its 2009 investment budget as it pours funds into infrastructure, education and health care, the official Xinhua News Agency reported on May 27.
China's Manufacturing Expands for Third Month, Adding to Signs of Recovery
China’s manufacturing expanded for a third month, adding to evidence that the world’s third-largest economy is recovering from its deepest slump in almost a decade.
Geithner to Tell China No One More Concerned About U.S. Deficit Than Obama
Treasury Secretary Timothy Geithner arrived in Beijing with a pledge that the Obama administration will control its borrowing as he sought to reassure China its holdings of U.S. government debt are safe.
China's Steel Association Rejects Iron Ore Prices Reached by Rio, Nippon
The China Iron & Steel Association rejected an agreement on ore prices reached between Rio Tinto Plc and Nippon Steel Corp., according to a statement on the group’s Web site. The price reached between Rio and Nippon Steel doesn’t reflect changes in the global market and would result in losses for Chinese steelmakers, the group said.
Treasuries `Only Game in Town' as China Boosts Holdings While Dollar Falls
For all the hand-wringing over the dollar’s slide, the expanding U.S. deficit and the nation’s AAA credit rating, the bond market shows international demand for American financial assets is as high as ever.
China Increases Diesel, Gasoline Prices as Much as 8%, Aiding Oil Refiners
China, the world’s second-biggest energy consumer, increased fuel prices by as much as 8 percent today, allowing the nation’s refiners to pass on climbing crude oil costs.
Prices charged by refiners to wholesalers for gasoline and diesel rose by 400 yuan ($58.57) a metric ton, the National Development and Reform Commission, China’s Beijing-based economic planning agency, said on its Web site late yesterday.
