In a clear display of how much money is chasing investment in the equities markets in China, the new small cap stock market, ChiNext, had a spectacular debut. The average value of the 28 companies in the index doubled the first day. Trading had to be halted several times.

According to Reuters, as many as 1,000 firms will try to list on ChiNext in 2010. If the Chinese economy falters, the ChiNext index could drop 50% in a day.

Douglas A. McIntyre