Any discussion of China has to open with the now-widely-understood fact that the numbers it reports are not to be trusted. Knowing this makes it easy to dismiss claims of high and consistently-on-target GDP growth, for instance, as a combination of government-directed borrowing and spending, and simple fabrication.

But how to handle negative numbers? When a serial fabricator admits that things are bad and getting worse, that would seem to imply that someone at or near the top has concluded that either the facts can no longer be obscured or that there's an advantage in creating negative expectations.

Whatever the purpose, the most recent batch of stories is both strange and scary. For example:

China's stock crash is spurring a shakeout in shadow banks

Peak insanity: Chinese brokers now selling margin loan backed securities

Here's a pretty good summary of current trends from Reuters: