Not another Tiananmen Square, please

Whether I am net short these markets in Asia or not, we do NOT want to see "another Tiananmen Square" in Lhasa (or, obviously, anywhere else, for that matter.)


So back in June 1989 we had student protests against corruption (initially) met with admirable restraint for nearly 2 months before Deng Xiaoping's brutal crackdown and the subsequent global condemnation we all remember... and China, a pariah for so long afterwards, only in recent years becoming rehabilitated (barring Sudan/Darfur) with stellar economic growth under generally more West-friendly leadership.

But the market tells us stock prices acted a bit differently.

In the days before there even was an HSCEI (H-share) index, you can see the hit on the closest thing we then had to a liquid China index, the HSI. Smacked down by a brutal one third in the days following the crackdown... but in about a year, the HSI had more than recovered, returning close to 70% from the lows.