Bubble Trouble Spoils China’s "Art Shares" Party

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BEIJING (REUTERS).- China’s maiden “art stock exchange” has halted trade in its top two paintings after their share prices soared 1,700 percent and ignited concerns that a new bubble was bursting. Just two months after the Tianjin Cultural Artwork Exchange listed shares in two Chinese paintings, the bourse said it was pulling the paintings from trade to “reduce investment risks and protect investor rights.” Wild asset price swings are not uncommon in China, where markets are often dominated by ordinary people who have few viable investment channels and earn little, if any, interest on bank deposits. In the past three years alone, items as varied as garlic, mung beans and ant-based aphrodisiacs have all experienced investment frenzies. The Chinese art market was also seen by many critics as a bubble in 2008 when auction prices soared. But the boom in art shares was something entirely new. The Tianjin art exchange, which opened in January, operates by listing works of art and then