Victor Shih |
AP:
Guangzhou’s co-owner Jack Ma alone reportedly lost $3 billion and investors big and small alike suffered precipitous falls in the value of their investments.
Victor Shih, a Chinese financial and political expert at the University of San Diego’s School of Global Policy and Strategy, believes that the market decline, and new regulations limiting liquidity, means transfer spending faces a major trim.
“It is a general problem for wealthy people in China who are major shareholders in companies,” Shih told The Associated Press.
“The emergency decree issued on July 8 prohibits any shareholder who owns over five percent of a company from selling these shares in the next six months. This is going to be a big problem for some people as they won’t be able to liquidate their wealth, if the shares are listed overseas, they will be OK. In this environment, it is certainly possible that major non-essential spending, like that on a soccer club, could be affected.”
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