Backgrounder on China's shadow banking system:
en.wikipedia.org/wiki/Shadow_Banking_in_China
Quote:
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Chinese shadow banking refers to underground financial activity that takes place outside of traditional banking regulations and systems. China has one of the largest shadow banking industries with approximately 40% of the country’s outstanding loans tied up in shadow banking activities.[1] Shadow banking in China arose after the People’s Bank of China became the central bank in 1983.
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It turns out the shadow banks use the 'gold' reserves as collateral.
The race is on, which collapses first: the shadow banks or Three Gorges dam?