Chinese stocks “unexpectedly” plunged last week in a fit of stormed selling that reminded of August rather than the placidity that has been claimed of China since. By mainstream account, China has fixed its bout of “selling UST” and “outflows” while also providing two double doses of “stimulus.” The PBOC had even taken to a higher fix in the middle rate, the policy setting that defines the RMB trading band. In light of all that, the 5.5% crash Friday seems so out of place.

That is why, it appears, commentary has focused upon government investigations into certain large brokerage firms and their “practices.” Like the June peak in Chinese stocks, then blamed on margin rules proposals from CSRC, there seems a bit more to it than that. For all the talk about normalizing financial conditions in China since August, there is very little that actually supports such a conclusion. Again, even the conventional assessments regarding the most visible difficulty are flawed by their cursory nature, and that “outflows”, which are nothing more than shorthand for “dollar” difficulties, remain the baseline of Chinese financial existence.

In that view, the fact that Chinese stocks would again run into heavy and intense selling isn’t surprising, especially given the clear and emphatic amplification of liquidity difficulties just in the past few weeks. November was particularly troublesome, tracing back, counterintuitively, to the October 23 double shot of “stimulus” (double meaning both a rate cut in the benchmark rate plus a reduction in the required reserve). Instead, it’s as if the typical monetarisms have been met as the anti-liquidity:

China’s economy is still showing a muted response to waves of monetary and fiscal easing as of the half-way mark for the last quarter of the year, some of the earliest indicators suggest. A privately compiled purchasing managers’ index and a gauge based on search engine interest in small and medium-sized businesses deteriorated this month, while a sentiment indicator dropped sharply from October.

China’s worst economic slowdown in a quarter century is also weighing on companies’ ability to repay bonds. China Shanshui Cement Group Ltd. this month became at least the sixth company in 2015 to default on yuan-denominated domestic notes. State-owned steel trader Sinosteel Co. postponed a bond payment for a second time last week.