China squeeze

Bloomberg: Leverage, counterparty risks and maturity mismatch. China’s record bull run in bonds had all the signs of a bubble in the making.Loose monetary conditions had fueled a sense of complacency, and all that was needed to trigger a reversal was for liquidity to tighten. When expectations for faster U.S. rate increases added to pressure from rising funding costs in China, the correction in the debt market -- which started in October -- turned into a rout. Bond futures plunged by a record last week, the 10-year yield surged by the most in two years and interest-rate swaps reached a 20-month high.The selloff has sparked a chain reaction among banks, funds and brokerages as losses spread. Much of the risk stems from a strategy favored by investment firms managing bank wealth products, which involves the borrowing of short-term funds to invest in debt. A year of low money-market rates made the trade lucrative, until the People’s Bank of China started tightening funding in August in an attempt to trim excessive leverage in the financial system. Lenders began asking for their money back and cut off the supply of cash, forcing the investment firms to reduce their holdings and hedge losses with derivatives.

Somewhere Xi Pimg Pong thought he could borrow endlessly.   Note the maturity mismatch?  That would hint at the MIT basket weaver's fake theory they have been selling. Currency bankers do not know time to completion.