China Crash: $28 Trillion Debt Load Forces Credit Crunch

china-crash-AP

From Ben Moshinsky writing at Business Insider:

The trading year started with a bang in China.

On Monday, China’s blue-chip stock market — the CSI 300 — fell 7% in the worst trading day in four months.

The sell-off saw about $590 billion wiped from Chinese shares, according to Bloomberg. The fall was so steep that it triggered a break clause that suspended trade for the day.

The government has managed to slow the drop to a crawl Tuesday by pumping money into the stock market.

But according to analysts from Bank of America Merrill Lynch, things could get a lot worse. They see the Chinese stock market falling by 27% in 2016, and it’s all because of debt.

Read the rest of the story at Business Insider.

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