The Chinese financial sector is definitely sending out some dangerous signals.  Overall credit has grown from $9 trillion to $23 trillion in the five years since Lehman, while the ratio of credit to GDP has surged 75 percentage points to about 200% in that time; this compares with an expansion of 40 percentage points in the five years to the implosion of the U.S. banking system in 2008, and about the same in the build up to Japan's Nikkei bubble in 1990, Evans-Pritchard showed.

A major problem is that much of this incredible surge in credit has been channeled through the shadow banking sector, which is very closely connected to the banks.  Total non-loan credit hit $5.6 trillion in 2012, with nearly $2 trillion of that credit extended by opaque non-bank financial institutions, Fitch's research shows.  Furthermore, more than $2 trillion were connected to informal securitization of bank assets in so-called wealth management products (WMP).

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