Pan-blues say state funds manipulated stock market

Pan-blue legislators yesterday accused the government of manipulating the stock market on Monday, causing the TAIEX to fall 244.37 points, in an attempt to thwart the pan-blue camp's proposal to recall the president.

The government intentionally manipulated the market to create the illusion that the pan-blue camp should be blamed for the decline in the stock index, members of the Chinese Nationalist Party (KMT) legislative caucus said at a press conference.

KMT legislators said that the government influenced the stock market through four government-controlled investment funds.

"It seems that the performance of [Monday's] stock market was a result of deliberate manipulation, as the stock index retreated sharply at the close of the market," KMT Legislator Pan Wei-kang (潘維剛) said.

Pan said the caucus requested the transaction amount of total buy and sell of the four funds from the government but had failed to obtain the information.

KMT Legislator Lai Shyh-bao (賴士葆) said the government must compensate investors for their losses if it is confirmed that the decline on Monday was a result of government manipulation.

"Given the NT$760 billion [US$23.71 billion] loss in market value and the roughly 4 million investors, each investor lost NT$170,000 on Monday," Lai said.

Responding to the legislators' accusations, Cabinet spokesman Cheng Wen-tsang (鄭文燦) said there were no unusual transactions on Monday and called on opposition legislators to refrain from incriminating the government by making something out of nothing.

Cheng showed the four funds' total buy and sell transactions for that day.

"The Cabinet looked into the transaction situation regarding Monday's stock market and didn't find any unusual transactions," Cheng said.

"On Monday, the total amount bought by the four funds was NT$1.72483 billion and the total amount sold was NT$1.86194 billion. As the short position of the four funds was NT$0.13711 billion, it accounted for an extremely trivial portion of the total transaction amount, which was NT$100.003 billion," Cheng said.

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