Monday, July 20, 2009

Wells Fargo on Chinese loan growth : Is China the next bubble?

On the heels of my post yesterday arguing that the equity rally we are seeing is being fed by Chinese loan growth, I came across this interesting research piece by Wells Fargo asking if China would be the next bubble? They are obviously concerned that this loan growth could lead to asset bubbles. The team actually makes a good argument that the lending boom in China is still under historical norms, especially when compared to an over leveraged US.

The report in chart form:

Read the complete report by clicking on this Scribd document link.

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