Jake's View | A bear in Shanghai should be commended, not condemned

The investigation [of Xiao Jinhua] is said to be focused on manipulation that contributed to panic selling during the 2015 market rout. - SCMP, February 2

The law punishes whoever originates or circulates rumours calculated to affect adversely the credit or business of individuals or corporations...

But how is the public protected against the danger of buying stocks above their real value? Who punishes the distributor of unjustified bullish news items? Nobody; and yet, the public loses more money buying stocks on anonymous inside advice when they are too high than it does selling out stocks below their value as a consequence of bearish advice during so called “raids”.

So reads “Reminiscences of a Stock Operator”, by Edwin Lefevre, Books of Wall Street, 1980, on page 297.

Lefevre was actually Jesse Livermore, the “Great Bear of Wall Street” in the early twentieth century and his Reminiscences is a stock market classic, a hugely readable account of the career of a professional speculator.

Just to put that career into perspective, however, Livermore died penniless, a suicide who shot himself in a New York hotel washroom after having scrawled the words, “My life has been a failure” on the washroom mirror.