Can you imagine all the people who have most of their savings in these things because they consider them risk free? When this bubble bursts, I don't see how the government will be able to contain this. https://www.bloomberg.com/news/arti...g-a-9-trillion-game-of-chicken-with-investors
Thanks a lot for this link, I have bought quite a few of those products, which are often as available for foreigners as for chinese, but haven't read much about them, which is disturbing. The quote below from Bloomberg's article will give everyone an idea why those products, usually offering a fixed return at inception, which varies along the benchmark deposit rate, are attractive : "It’s easy to see why. Despite investing in volatile assets from corporate bonds to stocks and real estate, WMPs have produced remarkably steady returns. Among the more than 181,000 products that matured in 2015, just 44 suffered a loss, most of which were sold by foreign banks. WMPs issued last week advertised an average annualized return of about 4.3 percent, according to Chengdu-based research firm PY Standard, versus the benchmark one-year deposit rate of 1.5 percent."