From a personal perspective of author Joe Zhang, the book describe in deep the regulations, the problems, summarize the market of credit in today China. Her history start with some chapters that fix the actual status of access to credit in Mainland China where many laws are dated back to 1949 and where the market doesn't exist. Now the state is going to liberalize from 2008 the microcredit industry, but in small town the firm that allow micro credit remain one for each zone or are related to the party or bureaucracy for permissions of lending. Surely the central problem capitulate is that the access of credit is almost simply from bank channel with high income intertwined with real interest rates (6/8%), and oppositely the high interest rates of micro credit channel between 20/30%. All summed is work for gambling, where real estate continue to build new cities and the final consumer pay almost entirely for allow the gains of highs stakes off artificially highs credit rates in shadow microcredit versus artificially low compared to inflation in clear banking system. The Zhang proposal then for raise the deposit rates and reduce the margins of great banks, but with emersion of shadow banking & deflate the bubble.
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