Monday, March 12, 2007

How we remember only what we choose to remember

6 month price chart for Shanghai Stock Exchange Composite Index. Before the Feb. 27 plunge, the index actually had a sizable correction towards the end of January. It declined 12% in three trading sessions, then recovered quickly and made new high above 3000, only to see the 9% drop in Feb. 27th. The index is now on its way to make another attempt at 3000 level. We only remembered what we choose to remember. We remembered what happened to the index on Feb. 27th because it's blamed for the near 400 points drop in DJIA, along with Yen carry trades and problems in subprime mortgages.