China Credit Shock: New Loans Fall For First Time In 20 Years Amid Relentless Deleveraging

Back in the years before covid, one of the most reliable market indicators was China's credit impulse, which ebbed and flowed with eerie regularity every 3 years, sparking either a global inflationary cycle on the way up, or vice versa when China's credit impulse was shrinking. Then came covid, and after an initial credit-fueled frenzy in late 2020 when Beijing literally pumped everything it could to kickstart the economy, China found itself in a prolonged real-estate depression as a result of its collapsing property market (who can forget the spectacular Evergrande implosion) which crippled the credit impulse cycle and left the economy in tatters.