Recently the Shanghai Interbank Offered Rate, the overnight rate that banks offer for loans to each other, went up to eye-brow raising 7%, which indicates a liquidity squeeze, which typically is the result of central bank action. If liquidity was flush, the rate would be below PBOC rate.

That may be in accordance with quality over quantity.

As regards China numbers, please don't forget the issue of man-made statistics. The issue may be getting smaller, but local governments creativity is unlimited.

So what the government aims to achieve is 5% *including "factor man-made"*, so in reality it is a levelling off of the top-line, while improving the bottom line.

How this works: The dual circulation is not new, it is the Japanese model that China has been following for ages.

Visualise a vertical pipe. At the bottom the lowest added-value imported raw materials go in and at the top the highest value-added products come out. No industrial interchange with abroad along the full length of the pipe. This is of course exaggerated, but it was valid in Japan until the end of the 1990, after the Asia Financial Crisis.

In case of China, it started off with a perforated pipe, industrial interchange with abroad along the entire length of the pipe. China has been systematically plugging the perforation for 20 years, starting from the bottom, using all kinds of means, WTO compatible or not.

What this does is, it creates 2 markets, one domestic and one external. In some products industrial exchange may be unavoidable, however, you can plug that by creating two standards, one for domestic, one for export.

Example: For the longest time Japan car manufacturers models for the domestic market were different from the models it exported. Export models were incompatible with domestic standards. You use the domestic standards to keep out foreign product to make it unattractive for foreign suppliers to turn out a product that is China-only.

Dual circulation is the consequent continuation of what China has been doing systematically for 20 years.

I gladly accept if my view is proven wrong.