There is an urgent need to tighten regulation of the real estate market as the risks of the property bubble have increased in the first half of the year even though China has imposed certain regulations on it.

At the same time, the willingness of domestic industrial enterprises to invest has significantly decreased and the so-called "trap of corporate liquidity" has emerged.

The research team at ANBOUND Consulting is of the opinion that the economic transformation under the new normal will test China in its allocation of economic resources in different fields.

Judging by the current situation, the continual circulation of financial resources within the circle of assets with capital surplus in the background needs to be contained, the further large-scale flow of funds into real estate must be prevented, and a turn towards the real economy and consumption is needed to prevent the trap of corporate liquidity and the worsening of the decline in private investment.