Pure speculation: Where will China’s ‘mother investor’ trend lead?
December 2, 2013 Leave a comment
Pure speculation: Where will China’s ‘mother investor’ trend lead?
Staff Reporter
2013-12-01
Chinese housewives with disposable incomes have been nicknamed “mother investors” by the investment sector for their boldness and high-stake speculating, such as their frantic buying of gold bullion and jewelry earlier this year amid low gold prices, which scared off Wall Street profiteers. Now, the mothers are having a good look at the virtual currency bitcoin as their next target, the Chinese-language Securities Daily reports.Figures from the Chinese bitcoin online trading platform huobi.com show that 40% of their VIP members — investors with an accumulated investment turnover of 10 million yuan (US$1.64 million) over the past few days — are women, suggesting they are the so-called mother investors or “big moms.”
Speculative investments by housewives with disposable income have seen as harmless to the national economy, but what would happen if industries began to give up manufacturing or their other areas of business to engage purely in speculation? For some sectors in China, this is already happening
Economist Wu Xiaopo recalled that a veteran maker of kitchenware once told him that he had shut down his company, which had been in business for several decades, so he could focus on real-estate investment.
This example suggests that “the Chinese can no longer make good kitchen utensils,” Wu said, warning that a rising wave of speculation is eroding the country’s industrial production structure.
Securities Daily noted that behind the wave of investments, China’s industry was being “hollowed out” as more and more private funds went into short-term and high-profit speculation.
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