Under the coordination of the leadership, several departments immediately took action, and within a few days, the relevant rectification measures were distributed to various banks and brokerages. Pen & Fun & Pavilion www.biquge.info

On January 27, some banks compressed the leverage ratio of umbrella trusts, and the stock market fell slightly by 0.89% to close at 3,352 points on the same day.

On January 28, the capital market regulatory department strictly investigated the financial business of small and medium-sized brokerages, which once again hit the enthusiasm of the market, and the stock market fell 47 points on the same day, down 1.41%.

On February 6, the regulatory authorities officially issued a decision to prohibit brokerages from selling umbrella trusts, which once again poured cold water on the over-the-counter allocation, resulting in a 5% drop in the stock market at the opening of the day, and finally fell more than 7% throughout the day, and the index also fell to 3049 points, becoming the lowest number since the beginning of the year.

It can be said that in the past two weeks, the management's continuous measures have sent a strong signal to the market, that is, to continuously cool down the current frenzied stock market and rectify the market by cracking down on leverage.

This approach was also clearly captured by the market, and the frenzy of capital allocation was controlled to a certain extent, and the stock market entered a period of correction in the following month, during which the index has been hovering around 3200 to 3300 points, neither a frenzied rise nor an inexplicable fall, and it seems that this period of regulation has been successful.

But a month later, on March 12, the situation changed again, and this time the stock market was like a wild horse on the loose.

On the same day, a shocking news came out of the market, which directly ignited the enthusiasm of investors.

Or because of the incident seven years ago, in response to the global economic crisis, the Chinese government at that time decided to implement a massive economic stimulus plan of 4 trillion yuan across the country. However, this is only the economic stimulus package of the central government, and various local governments have also successively introduced economic stimulus plans in their own regions, and the economic stimulus package for the whole of China has reached an astonishing 10 trillion yuan.

Although it succeeded in avoiding a slowdown in economic growth, over time, this part of the debt gradually became a major problem for local governments. Because, at the present level of their revenues, it is far from possible to repay the principal of these debts.

In this case, the central government has to join in the process of resolving these local debts. At present, there are several theories circulating in the market, including methods such as extension, replacement, and debt-to-equity swap.

Rollovers are the simplest in procedure, i.e. extend the time limit for repayment of these debts when they mature, while paying part of the overdue funds. However, there is a downside to this, that is, the original investors will lose confidence in the repayment of these debts, and then sell this part of the bond at a low price in the market, which is very likely to cause the collapse of the entire bond market.

A debt swap is the replacement of an old bond with a new bond, and the new funds raised are used to repay the principal and interest of the previous debt. This does not result in a default and buys the debtor more time. And most importantly, as inflation grows, this part of the debt is actually getting smaller and smaller. Therefore, the market generally believes that the central government will eventually take such measures to solve the debt problem of local governments.

The last type of debt-to-equity swap is to convert the debts in the hands of creditors into shares according to a certain proportion. Because local governments issue debt through their own state-owned assets, if debt-to-equity swaps are implemented, some of the state-owned assets they own will be converted into private ones. The disadvantage of this approach is that, firstly, it is difficult for the debtor and creditors to reach an agreement on valuation, and on the other hand, the transfer of state-owned assets is easy to cause social criticism.

Comparing the three treatment methods, the market unanimously believes that the debt swap method will be selected to deal with the local debt problem.

This raises another problem, which is almost equivalent to putting trillions of dollars into the market at once through a debt swap, which can be called a large-scale QE operation.

To a certain extent, QE is absolutely good news for the capital market.

In addition to the explosive news of local bond swaps, there is also a piece of news that excites the market. A vice president of the capital market regulator said on the day that the regulator is working with institutions around the world to strive to include ChinaAMC's capital market in the MSCI index as soon as possible.

MSCI, Da Mo International Capital Company, is a well-known index compiler in the world. Their index is the most widely used fund index in the global portfolio economy, with more than $10 trillion of global assets benchmarked against MSCI's index, which is used by more than 97% of the world's asset management. It can be said unceremoniously that this index is a barometer of global assets.

Unlike other indices, if a market is included in the MSCI index, MSCI will contribute to the purchase of the underlying stock and participate directly in the market. Based on the current market value of the ChinaAMC stock market, even if you want to track the top three companies in the industry, MSCI may have to spend tens of billions of dollars to buy related stocks. If it wants to fully reflect the situation of China's capital market, MSCI may have to pay at least hundreds of billions of yuan.

This news also means that there are at least 100 billion yuan of capital waiting to enter China's capital market.

These two pieces of news were released on the same day and immediately detonated the entire market.

The stock market rose 0.7% at the start and rose 1.72% for the day to close at 3,349 points.

Most importantly, after more than a month of entanglement, the index finally broke through the upper limit of 3300 in one fell swoop and rose by as much as 49 points in one day.

More stock commentators commented after hours that the market will soar after breaking through 3300, and the bull market 2.0 will start again.

Sure enough, after the conflict at 3300, the market seemed to have no more pressure, and there was a positive candle for eight consecutive days, which directly pushed the index up to 3687 points before there was a certain pullback.

In just eight trading days, the entire market has risen by nearly 10%, and the strong performance has stunned the entire market.

It is important to know that the performance of this index is the performance of those stocks that are included in the index, and these stocks are either heavyweights or blue chips, and generally the stock price does not fluctuate drastically. But in the past eight trading days, these heavyweights and blue-chips have collectively risen by nearly 10%, and it can be seen how the smaller stocks will react.

Small-sector stock P/E ratios have collectively been pushed up to nearly 100 times, meaning it will take at least 100 years for earnings per share to recoup the cost of the share price. And that's just the average number of hundreds of stocks, with yields of up to 150 to 300 times.

You must know that the average life span of Chinese enterprises is only 7 years.

What's even more ridiculous is that some new stocks have continued to rise after the listing, from a few yuan at the opening to as many as a few hundred yuan, and these companies have reached dozens of them, and even some of them have not even made a profit, and they can't even calculate the price-earnings ratio.

The market is crazy, traditional financial statistics can no longer reflect the true value of stocks, and the price-earnings ratio is also jokingly called the market dream rate, representing flashy and exaggerated dreams.

And then it all didn't reach its climax, and after a brief correction, on March 30, the stock market sounded the rallying cry again.

The two land and housing construction departments jointly issued a document to standardize the land use of the country, optimize the housing supply structure, increase the supply of affordable housing in the market, and make full use of the laws of the market to provide the supply of buildings.

Naturally, this news undoubtedly caused the rise of the entire real estate sector of the market, although the content of this document does not constitute a good for the real estate sector, but under the crazy market, as long as any industry news comes out, funds will flock in, directly stimulating the rise of the sector.

Another piece of news is about the pharmaceutical sector, the Ministry of Science and Technology decided to implement a strategic plan for precision medicine, and will invest 60 billion to 100 billion yuan in this plan in the future.

Regardless of whether companies are eligible to participate in this strategic plan, in short, the entire pharmaceutical sector has also taken off. Funds from the market poured in, and soon the stock prices of various pharmaceutical companies skyrocketed.

At the same time, the release of a piece of news about Internet finance also stimulated the rise in the stock prices of banks, brokerages, and Internet companies.

Along with these announcements is the not-so-good-sounding news, with data from the Bureau of Statistics showing that in January and February, the country's total profits of industrial companies fell by 4.2 percent. Among them, the decline in profits of mining and energy-related companies is particularly obvious.

Obviously, this is not good news, and the economic growth is being blocked. But the irony is that, in addition to a slight decline in the share prices of energy companies, the entire market once again saw a strong rally throughout the day, opening 19 points higher in the morning and rising 95 points or 2.59% throughout the day.

On April 16, this crazy rally hit a new high again, because of the launch of two new stock index futures, the entire market opened 1.45% higher on the day, and the 61-point high opening was the highest in history, while rising 2.2% throughout the day, compared with the previous day's low, it rose directly by as much as 300 points, reaching a terrifying 4287 points.

By April 27, the crazy market finally reached a climax, and on the same day, because of the central bank's reverse repo, the market rose by 3.04% again, and the index reached 4527 points, a new high in seven years.

Although the market interprets the central bank's reverse repo behavior as a disguised RRR cut, few people have noticed the difference between the two, and investors are reveling, they are looking forward to the moment when the index breaks through 5,000 points.

After the government decisively implemented measures to cool the stock market, the market skyrocketed by 50% again in just two months. (To be continued.) )