A report issued last year by the People's Bank of China consisted largely of self-praise; nowhere in its 200 pages was there a word about the money that the bank and Finance Ministry have spent to bail out the financial system. An enthusiastic reader might have concluded that China's financial situation was rock solid.
A historical footnote might have clarified the picture. There was little concern about risk in China's central bank before the Asian financial crisis in 1997. The country's closed financial system and restrictions on currency flows were a solid defence against the quick movements of foreign funds that hit Southeast Asia in 1997.
Those defences have fallen, though, because of excessive reliance on foreign direct investment and exports to fuel the economy. Now the mainland economy is exposed to hosts of influences from the international system.
For that reason, the PBOC hedges its optimistic report with caveats and assumptions about stability and no external disruptions. Those could include a worsening of international tensions concerning Iran, affecting mainland oil supplies; or the US trade deficit could become so politicised that Washington slaps new tariffs on Chinese goods. Either could spark a falling-domino series of factory closures, since the nation is already tottering on an over-production crisis funded by bank credit.
Either scenario would be a severe shock for the mainland's financial system: foreign investment and trade drive 70 per cent of its economic growth, according to some estimates. So it is not surprising that China's central bankers have consistently disregarded the International Monetary Fund's recommended medicine of opening up their financial and currency trading systems - as Indonesia did, probably to its regret - or listening to Washington's insistent advice to let its currency appreciate.
Following the Asian financial crisis, some 26 provinces, autonomous regions and municipalities under the central government had to bail out their own financial institutions.
Similarly in 1998, 270 billion yuan in special treasury bonds were issued to recapitalise the 'big four' state-owned commercial banks; their 1.4 trillion yuan in non-performing assets were separated into asset-management companies.