Chinese journalist 'confesses' to market chaos: state media

 JournalismPakistan.com |  Published: 31 August 2015

A Chinese journalist confessed on state media to causing major losses in the stock market. This comes as authorities struggle to manage a financial crisis following a bubble burst.

Summary

BEIJING: China's main state broadcaster Monday paraded a financial journalist "confessing" to causing the stock market "great losses" as authorities seek to rein in a rout on the exchanges.

Wang Xiaolu (pictured), a journalist with the respected business magazine Caijing, was held after writing a story in July saying the securities regulator was studying plans for government funds to exit the market. Beijing has launched interventions on a grand scale to try - with little success - to shore up plunging share prices after a debt-fuelled bubble burst in June.

Britain's Financial Times reported at the weekend that China had decided to stop buying shares in favor of intensifying a crackdown on those "destabilising" the market, although there was speculation as recently as last Thursday that government funds were acquiring stock.

The ministry of public security also said at the weekend that 197 people had been punished for "spreading online rumours" on several issues, including the markets and giant deadly blasts in the port of Tianjin on August 12. It gave scant details.

China has unleashed an unprecedented package of support measures, including using state-backed entities to buy stocks and cracking down on "malicious" short-selling - when investors sell shares they do not own in anticipation of a fall in their price.

But the moves have done little to calm investors and concerns about the health of China's economy and its ability to manage its finances has infected world markets, sparking one of the worst global sell-offs since the financial crisis on August 24. State broadcaster CCTV showed Wang as saying that he had sought to create a stir and catch the eyes of readers with his articles.

"I should not have published a report that heavily and negatively affected the market at such a sensitive time... (I) caused such great losses to the country and to stock investors. I am deeply sorry," he said.

Xinhua said Wang was held for fabricating and spreading fake information which had "caused panics and disorder at (the) stock market, seriously undermined the market confidence, and inflicted huge losses on the country and investors".

In China high-profile criminal suspects are regularly paraded on television apparently confessing to their actions, in what rights lawyers say is a violation of criminal procedure. Once prosecutors post charges, conviction is all but guaranteed in courts which are tightly controlled by the ruling Communist Party.

Journalists' rights group Reporters Without Borders last week said it was "absurd" to blame China's stock market crash on a reporter and called for Wang's immediate release. "The accusations against Wang are symptomatic of the Chinese government's desire to control media coverage of share price movements," the group's secretary-general Christophe Deloire said in a statement.

"Suggesting that a business journalist was responsible for the spectacular fall in share prices is a denial of reality. Blaming the stock market crisis on a lone reporter is beyond absurd." - AFP