Rick Pearson - that's a very good article. It can not be stressed enough that you have to approach the China space with a good portion of healthy skepticism. Most people choose to believe (or consider more credible) what they want to believe. Not just on the financial markets, but generally. Heck, according to a recent survey about 50% of Republican voters in the U.S. still "believe" that Saddam Hussein had weapons of mass destruction.
While at this time last year the tone generally, and especially on this board, was to consider the long argument for most stocks more credible - we do now have pretty much the exact opposite situation. All of a sudden questionable short pieces (undisclosed sources, anonymous authors, arguments based on unverified documents obtained with bribes or through third parties, or even illegally) seem to be true unless proven wrong. And whatever the company might come up with to its defense is considered doubtful.
The White House released Obama's birth certificate now. The first comment I read on the article announcing that was something like "this is fake. He's the president, he can fake anything. No way I believe that he was born in the U.S."
Skepticism is healthy and absolutely necessary, but with both sides of the argument. Many companies and officials are lying (telling half-truths) all the time, but so are people who have taken a short position in the stock. And additionally, arguments can be wrong even if the author is convinced to have a strong case.
AI
