Stockmarkets around the world have gone into freefall in consequence to China’s ‘Black Monday.’

The Dow Jones index in the US went into a tailspin, dropping more than 1000 points within minutes of opening.

Sharemarkets in the UK, Germany, France, Spain, and Italy also plunged as China’s Shanghai Composite Index saw 8.5 per cent wiped off its value on Monday.

In the UK investors were horrified to see more than $85 billion lost in the first three hours of trading. Markets in Australia, Korea, and Hong Kong shed more than 4 per cent.

Experts believe what has come to be known as The Great Fall of China is a result of investor suspicion over the competence of Chinese leaders.

“Volatility will persist,” said Didier Duret, chief investment officer of ABN Amro to Reuters, “until we see better data there or strong policy action through forceful monetary easing.”

Fraser Howie, author of Red Capitalism: the Fragile Financial Foundation of China’s Extraordinary Rise, said to the Guardian: There is a “growing realisation China’s leaders do not have a clear idea of how to handle things.

“Not only are they not in control of it, they don’t even seem to grasp the problems at times.”

In 2014 Chinese state media announced that shares were relatively cheap. Investors converged on the market driving the benchmark index up more than 150 per cent.

However, prices plunged after unrelated changes to banking regulations in June. These changes led investors to doubt the underlying support of the rally.

The market index fell by 30 per cent.

Beijing intervened by banning large shareholders from selling their stakes.

State owned brokerages, however, were given the promise of being bailed out by pension funds.

The intervention did calm the market to some degree.

But when the state-owned company charged with buying the shares announced it would not intervene in a predictable way investors jettisoned their shares.

The Shanghai index spiralled down 11.5 per cent last week alone.

Analysts are pointing out that political leaders in China are happy to take the credit when the market rises; but they seem loathe  to accept the blame when it drops.

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