Caixin reports an increasing amount of money in China has been trapped inside the financial industry, flowing from one bank to another, increasing the risk of bubbles and thwarting stimulus, according to a research report by Haitong Securities. The growth was fueled to a large extent by banks’ lending to each other aggressively and investing in each other’s wealth management products, the report said. Banks’ leverage ratios have surged as they borrowed more and more from each other. The report shows that, on average, the total assets of depository financial institutions in China (excluding the central bank) have grown to almost 50 times their net capital. The high assets-to-net capital ratios are alarming compared with those in the United States, which has not exceeded 20 since 1970s, or those in Japan and South Korea, which have remained below 30 most of the time.