Tae Soo Kang,  Korea Institute for International Economic Policy: The sense of urgency is globally quite high for China's macro-leverage when the Governor of the People's Bank of China refers to a “Minsky moment.” Zhong and colleagues shed light on the preconception (illusion) about Chinese corporate debt through an insider's window.

According to BIS (Quarterly Review 2017), Chinese corporate leverage ratio has reached 163 percent of GDP—the highest level in the world. The prevailing preconception is that the debt ratio of Chinese firms is generally on the rise. The insider view is starkly different from that in the BIS Quarterly Review of 2017. Six stylized facts found by Zhong et al. look hugely different from an outsider's evaluation.

Regarding Table 1 (Is the leverage supported by economic fundamentals?), I have the following concerns.

However, Zhong et al. explain leverage behavior only through the private corporate (demander) side. This leads to...

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