Two China graphics for the day

First, from Goldman Sachs, via MR, on the total fiscal deficit, including off-balance sheet items, which touched 15% of GDP!

Second, Ananth points to the spurt in public spending stimulus in the first half of 2016, which rose by 23.5%, even as growth in private fixed investment fell to a record low. 

It is clear that the Chinese government is still reluctant to face the reality and take on the challenge of squeezing out the excesses from credit-fueled growth that has become entrenched over the years. But, like with everything China, however, there are sub-plots. The recent debate on "systemic financial risks" and the increasingly direct role of President Xi Jinping in the country's economic affairs, over the head of the State Council headed by the Prime Minister Li Keqiang, may portend some course corrections. But it is unlikely to be anything like what is necessary.