The severe epidemic prevention policies of the Chinese Communist Party have destroyed the companies of at least 70 million entrepreneurs on the mainland. One of them is the CEO of a group in Beijing, whose company went bankrupt and had to sell his house to repay debts. Devastated by the situation, he turned to stock trading, only to lose most of the 2 million yuan he invested, leaving him with only 290,000 yuan. The plunge of A-shares below 3000 points added to his distress, reflecting the common experiences of many entrepreneurs and stock investors in mainland China.
Recently, the self-media personality “Riri Jianhao” shared his bitter experiences in a video program. He recounted the roller coaster of his life in recent years, from being a group CEO to a moderately successful entrepreneur, to facing bankruptcy during the pandemic, to selling his house to settle debts. Subsequent failed stock trading, health problems, and ongoing medical treatments plunged him into a period of life’s lows.
In 2017, he was the CEO of a group in Beijing, having worked in the physical industry for half his life. He later ventured into entrepreneurship and achieved moderate success by 2020, only to face bankruptcy during the pandemic in 2021. Unable to sustain his company due to the epidemic, he had to close it down, sell his house to repay debts, pay employee salaries, and compensation. He was left with just over 2 million yuan.
During the three-year epidemic period from the beginning of 2020 to the end of 2022, the Chinese Communist Party’s extreme epidemic prevention measures not only failed to control the outbreak but also destroyed numerous companies like “Riri Jianhao”.
Economic Observer Network once reported that Yu Yang’s video production company in Shanghai also couldn’t withstand the epidemic control. “After a month of closure, his company suffered a net loss of 320,000 yuan.”
In May 2022, Yu Yang couldn’t even pay his employees’ salaries.
With 15 employees earning approximately 300,000 yuan per month, Yu Yang faced a dilemma. He either had to borrow 200,000 yuan from family and friends to pay the May salaries or be transparent with them, acknowledging the financial strain and the possibility of delaying payments. If the epidemic continued beyond June, he didn’t know what to do next. He couldn’t afford to lay off everyone, yet he couldn’t pay their salaries either.
Entrepreneurs like Yu Yang in China number over 70 million, described as the “capillaries” of the Chinese economy. Unfortunately, the fate of these “Yu Yangs” seems predetermined.
After the closure of his company, “Riri Jianhao” felt extremely despondent, suffering from severe insomnia and lacking the motivation to engage in any activities. Lacking knowledge of good investment channels, he turned to learning stock trading.
Initially investing 200,000 yuan to test the waters in stock trading, he made some profits. But then he began engaging in impulsive trading actions like bottom-fishing and adding positions haphazardly, gradually increasing his investment to 500,000 yuan, then 1 million yuan. Eventually, he poured his entire 2 million yuan into stocks.
His most disastrous stock investment turned out to be in “Xia Hua Electronics”.
In April 2022, “Xia Hua Electronics” faced consecutive days of limit-down, offering no opportunity to exit the market. When news of its delisting was confirmed, its stock price plummeted to 0.4 per share, resulting in a loss of over 90% of the 600,000 yuan he invested in it. “This incident completely blindsided me.”
On the evening of June 23, 2022, Xiamen Overseas Chinese Electronics Co., Ltd. announced that the company’s stock had completed the 15-day trading period in the delisting consolidation phase by June 23. The stock was officially delisted from the Shanghai Stock Exchange on June 30, 2022, marking the end of the listing of this once-generation giant in color TV production on the A-share market.
On June 23, the last trading day for “Xia Hua Electronics” on A-shares, the closing price was 0.6 yuan per share, with a final market value of only 314 million yuan.
Public information indicates that Xiamen Overseas Chinese Electronics Co., Ltd. was founded in December 1985. In February 1995, “Xia Hua Electronics” A shares were listed on the Shanghai Stock Exchange, making it the first plasma TV manufacturer in China.
“Riri Jianhao” believed that his lack of expertise led him to enroll in various educational programs, cutting losses as he learned, until he found a good mentor. By then, he had 470,000 yuan left.
Since the Shanghai Composite Index first broke the 3000-point barrier in February 2007, it fluctuated around the 3000 point mark for the next 16 years. The mark seemed like the border between prosperity and decline, becoming a psychological cornerstone for stock investors.
However, news of the Shanghai Composite Index falling below 3000 points quickly dominated major financial websites in October 2023.
On December 5, 2023, after a month and a half, the Shanghai Composite Index once again fell below the 3000-point mark.
“Riri Jianhao” expressed his disbelief at encountering a stock market disaster as the index plummeted below 3000 while he was fully invested. This wiped out his funds, leaving only 290,000 yuan. “Even when I lost from 2 million to 470,000, I wasn’t as panicked as this time. I was truly frightened that this stock market crisis would wipe out the remaining funds, so I hesitated to cut more losses. After the Chinese New Year, I chose to hold on and endure. Until today, I haven’t dared to touch it.”
He mentioned that after over a year of medical treatment, his health gradually improved. He planned to open a shop, but friends advised him against it.
In mainland China, there are countless stock investors with similar experiences to “Riri Jianhao”.
On April 25, the three major A-share indices closed mixed. In the morning, they opened lower but turned positive and maintained a sideways trend after morning trading. At the close, the Shanghai Composite Index was at 3052.90 points, and the Shenzhen Component Index was at 9264.48 points.
Regarding individual stock performance, 2237 stocks registered declines. Trading volume decreased, with the Shanghai and Shenzhen markets trading a total of 774.3 billion yuan throughout the day.