It's official: Foreign lending to China and emerging markets collapsed at the end of last year
From panic in the Chinese stock markets in August and January, to a return to a commodities bull market and rising steel prices, the waters have been choppy to say the least.
But it is worth remembering just how bad it got for emerging markets in 2015 and data from the Bank for International Settlements, the Basel-based central bank for central banks, shows just how bad it's been.
The BIS said: "Cross-border bank credit to emerging market economies in aggregate contracted by 8% in the year to end-December 2015, the largest annual rate of contraction since 2009."
Claims on China fell by $114 billion (£79 billion), the largest drop during the quarter, according to the BIS.
The figures show how quickly a panic can spread in the banking sector. "Whereas in Q3 2015 this slowdown was most pronounced for interbank activity and lending to emerging market economies, in Q4 2015 it spread across sectors, major currencies and regions," the BIS said.
Here's the chart:
The concerns have evaporated since then for the most part. The world's second largest economy added 2.34 trillion yuan ($362 billion) of new debt in March, far exceeding the median forecast of 1.4 trillion yuan in a Bloomberg survey.
The surprising data prompted George Soros to say that the debt explosion in China "eerily resembles what happened during the financial crisis in the U.S. in 2007-08, which was similarly fueled by credit growth," according to Bloomberg.
"Most of money that banks are supplying [in China] is needed to keep bad debts and loss-making enterprises alive," he said at a conference at the Asia Society in New York.