Market falls threaten to expose cracks in corporate China
Rapid increase in leveraged trading raises fears of forced selling that could trigger broader financial instability
Shanghai
DESPITE reassurances by regulators that margin debt in China's stock markets remains manageable, total leverage could be as much as US$645 billion - magnifying risks not just for retail investors, but also the thinly stretched corporate sector.
The scale of lending in China's stock markets has become a major concern for global investors. For many, it is a greater worry than even the Greek crisis because a Chinese market crash could destabilise the world's second largest economy.