BAML: Irrational exuberance is leading us to the to next crisis in China. Bloomberg reports that it is Amateur hour on the Chinese stock market as new stock accounts open at the fastest pace since 2007 and the Chinese equivalent of penny stocks are trouncing the benchmark index. But Bank of America Merrill Lynch analysts warn China is at mounting risk of a financial crisis this year as growth sputters and deflationary pressures trigger a wave of defaults. Loans have jumped to 100% of GDP in the past 5 years... which is more than twice the pace of growth in Japan over a comparable period before the Nikkei bubble burst in 1990, or in the US before the Lehman crisis in 2008. David Cui from BAML writes when the sell-off happens, we suspect that it will not be orderly. Full article: (VIEW LINK)