No one likes to be a party pooper, but there's no getting round the fact that the party for mainland Chinese shares - and therefore, to a lesser extent for Hong Kong shares - will soon be over. There is no need to qualify this statement because there is absolutely no record of a market rising as quickly as the Chinese stock markets without a subsequent crash. I'm not talking about the recent turbulence, but the real thing - a massive rout with prices falling through the floor.
Most markets, however, are not so heavily driven by government policies. And few government leaders have been as foolish as those in Beijing and Hong Kong, who imply that they somehow should take credit for spiralling stock prices.
Moreover, there are some extremely foolish people, inside the political elite and outside, who proclaim that the dizzying rise of Chinese stocks is different from what happens elsewhere in the world, and need not be followed by a crash. How little they know of the way markets work or indeed of the history of crashes. It is safe to say that every spectacular share boom has been accompanied by assurances that 'this time it will be different'. That was certainly the argument advanced in Japan before the 1989 crash, and it was often heard before the great crash of 1929.
On the mainland, there is always a tendency to argue for Chinese exceptionalism. And, in some ways, there are exceptions that apply to mainland stock markets. That's because no other major world market has such a small percentage of international investors, or has the bulk of the stock owned by the state. No other place has been quite so influenced by the dictates of political leaders prepared to sacrifice the free operation of the market for short-term political ends.
Thus, we keep hearing that Beijing will not allow a crash to occur before this month's Communist Party congress, or even before next year's Olympic Games. Indeed, it's more or less in the government's power to ensure that. But bottling up market pressure is not the same as removing the underlying reasons for market responses.
The stark fact is that mainland companies are trading at quite absurd valuations. Firms that are effectively bankrupt command enthusiastic investor support. This is made all the more excruciating by the fact that most of these technically bankrupt corporations are banks. There is no way that most companies listed on the mainland can sustain the growth rates implied by the share prices of the best firms listed there.
Because Hong Kong has a genuinely open stock market with high levels of international participation, it provides a perfect back door for mainland investment. Indeed, if the government has its way, the back door will be eased so wide open that every bit of flotsam and jetsam from mainland markets will find their way onto the Hong Kong exchange.