– It’s Not Just Margin Debt: Presenting The Complete Chinese Stock Market Ponzi Schematic (ZeroHedge, July 26, 2015):
Late last month, we suggested that the pressure on Chinese equities – which at that point had only begun to build – was at least partially attributable to an unwind in the country’s CNY1 trillion backdoor margin lending edifice. Precisely measuring the amount of shadow financing that helped drive Chinese stocks to nosebleed levels is virtually impossible, as is determining how much of that leverage has been unwound and how much remains or has been restored, but BofAML is out with a valiant attempt to not only identify each shadow lending channel, but to quantify just how much leverage may be built into the Chinese market. The figures will shock you.
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