People's Bank of China Governor Zhou Xiaochuan says corporate leverage too high
The elephant in the Chinese room is debt. It's rarely addressed and it's at time difficult to understand just how much debt is swirling around the Chinese economy.
The PBOC's Zhou said the country needs more regulation.
"Lending as a share of GDP, especially corporate lending as a share of GDP, is too high," Zhou said.
The problem is that China needs growth for stability. The NDRC Chairman said on the weekend that the economy can grow above 6.5% for each of the next five years.
Zhou said one of the options for addressing high leverage is to channel more savings into capital markets. That's a signal that China will continue to prop up the stock market.