How A Chinese Farmer Lost More Than Everything Trading Stocks

Zero Hedge ^ | 07/28/2015 | Tyler Durden

[SeekAndFind]

Last night, just six weeks after one Chinese farmer Liu Jianguo invested his life savings in the Chinese market, proclaiming "it's a lot easier making money from stocks than farm work," we wondered if it was time for a sequel:

It's time for the sequel: how the Chinese farmer bet on stocks and lost everything http://t.co/l1EEAHFiEg

— zerohedge (@zerohedge) July 28, 2015

A few hours later we find out that it was because as CNBC reported in its sequel, another farmer has lost it all... and more. As CNBC's Eunice Yoon reports, just a few weeks after his glorious gamble in China's manipulated market, the farmer "trader "now owes - thanks to wonders of margin calls and leverage - as much as he originally invested.

From the hope-filled exuberance of early June to Yang Cheng's utter hopelessness, "I have lost everything," after he followed the government's 'grand plan' to open the economy and encourage stock market speculation.

Having piled his life savings (plus his relatives' money) into the market, thanks to encouragement from his broker he borrowed $1 million in margin and bet it all on one stock - a local mining company.

Now, after being forced to liquidate by the same risk-encouraging brokerage, he has suffered catastrophic losses... and he is not alone...

"I don't know what to do... I trusted the government too much..." he exclaims, adding "I won't touch stocks again, I have ruined everyone in my family."

CLICK ABOVE LINK FOR THE VIDEO

We can only hope Yang Cheng's breakdown at the end will serve as a lesson to those betting on "The Fed has your back," or whatever meme the moment requires.

[Pearls Before Swine]

Poor guy. Wasn’t it Deng who said, “To be rich is glorious?”

Sometimes you get the bear, sometimes the bear gets you.

[SeekAndFind]

[Gaffer]

If you’re gonna have to “owe”, owe big....too big to fail...

[Pearls Before Swine]

Great cartoon!

[SeekAndFind]

[Olog-hai]

The last thing you allow communists to have is a stock market, because they are always working to destroy capitalism. Was not Marx clear enough in his intent?

My object in life is to dethrone God and destroy capitalism.

Hence, having a stock market in a communist country is not only intended to suck in foreign “capitalists” and steal all their money, but to also indoctrinate their “masses” of just how “evil” capitalism is and how everyone must embrace socialism first and the ephemeral communism second.

[SeekAndFind]

[Dilbert San Diego]

To hear this news about the Chinese stock market, just reinforces my own confusion about China. They are officially communist, but have instituted many free market reforms in recent years. There are many millionaires in China, people who run companies and have made millions running their businesses. Yet supposedly private ownership of that manner is banned under communism.

Perhaps we can say that the Chinese have a system of government controlled corrupt capitalism??? They still do not have political freedom. The communist party is still in control and do not allow free elections.

[alloysteel]

There was an old story about a farmer, upon retiring from farming, bought into a hardware store. One day, one of the suppliers was visiting, and looking through the stock, saw the newly-minted merchant was selling hammers for $1.25.

“Man!” exclaimed the supplier. “Don’t you realize you are paying $13.46 each for those hammers wholesale? How can you be making any money doing that?”

The one-time farmer replied, “Oh, I dunno, but it STILL beats farming!”

[tbpiper]

Writing naked puts? Yuan cost averaging?

[dragonblustar]

"I don't know what to do... I trusted the government too much..." he exclaims, adding "I won't touch stocks again, I have ruined everyone in my family."

Heartbreaking lesson to learn.

[pepsi_junkie]

Last night, just six weeks after one Chinese farmer Liu Jianguo invested his life savings in the Chinese market, proclaiming "it's a lot easier making money from stocks than farm work,"

It's easy to see after the fact but a contrarian would look at an article like this and say "uh oh, people who know nothing about the market are putting their life savings in because everyone knows it's easy money. Time to bail!"

Full disclosure, I have a sliver of my own investments in international primarily because all the experts insist it's a hedge. But I keep it small because I don't trust the communists, dictators, and entrenched bureaucrats in other countries to run their markets or the economies well or fairly. The US pack of regulators, bureaucrats, and corrupt politicians are at least a devil I know.

[DCBryan1]

Poor guy. Wasn’t it Deng who said, “To be rich is glorious?”

Maybe one of those pilots, "Sum Ting Wong"

[tet68]

Zen tells us, “To know contentedness is to be rich.”.

[Oztrich Boy]

It’s not possible to lose more than everything.