China’s government has trebled the stamp duty on the trading of shares in a bid to cool the country’s overheated stock market. The tax will rise from 0.1% to 0.3% with immediate effect, Beijing said.

This isn’t fighting a fire, this is p*ss*ng on the ashes. Now if they had made it maybe 5%, that might have got someone’s attention. Even so, given current turnover of USD50 billion per day, that represents an additional USD100 million a day in stamp tax!

At some point, though, they are going to rein this in. The Chinese government does not like being ignored, it sets a bad precedent. And besides, highly productive activities are being sacrificed for trading:

(China Daily)

Updated: 2007-05-21 14:52

“Workers do trading on the toilet.

Workers in Chengdu, Sichuan have turned to trading in the toilet to avoid being caught by their bosses. Many business are getting frustrated by staff trading instead of working and have been clamping down on the activity, forcing staff to trade in secret.

Undeterred by the firewalls installed on their computers to prevent them visiting trading-related websites, crafty workers intent on making their fortune now call their brokers from the toilet.”

I am really working hard to resist the temptation to exploit further opportunities for toilet humour. It really isn’t funny, it’s sad. A lot of people are going to lose their savings.