Getting prices right

Market function: An investor looking at an electronic board showing stock information at a brokerage house in Nanjing yesterday. The risk management function of the stock market is critical to the funding of the real economy. – Reuters

THE two events that shook the world in June and early July were the Greek crisis and China’s stock market gyrations.

Both events were about getting prices right – the Greek negotiations on whether Greece can sustain such high debt without some debt write-offs and the Mainland stock markets finding their own price equilibrium.