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Relax, China’s banks aren’t about to have a meltdown
The international community of China-watchers is suffering one of its periodic flaps. China’s debt levels, we are told, are spiralling out of control, and the country is speeding towards its very own version of the Lehman crisis of 2008, except on an even bigger scale. Several things have come together to feed this latest flap. Last week, the Bank for International Settlements, often called “the central bankers’ central bank”, flashed a red light over something called China’s credit-to-GDP gap, which it said had widened to more than three times the level normally considered dangerous. Coming on top of ... (full story)