China wants lower asset prices. It wants fewer reserves. It wants less inflows. The only way to do this is to accelerate capital outflows and encourage international leverage.  This is happening now. How

1) The CNY volatility is intentionally being encouraged.
2) Important new rules have been promulgated to encourage PRC nationals to use domestic asset prices as collateral for FX borrowing.
3) Offshore RMB issuance is being ramped up in a big way.  (Take a hint: The CNY has peaked.  The FX is probably at its strongest level and will go sideways at best.)

This is probably the cheapest the world will ever get for China to buy international assets and now it can use leverage in ways that were illegal before. Now, China can use leverage and outbound capital to purchase land, technology, property, naval bases… and, most important of all, friends.

This means that asset prices domestically have probably peaked.

We have done work on the relationship between bank stocks and property stocks. Quelle Surprise! Bank stocks tend to lead property stocks by about 30 days with a remarkably high correlation.  See inside. Bank analysts and property analysts should be collapsed into one team all over.