China’s new political risk premium

FOR THE average investor, China is the source of all sorts of uncertainty. A regulatory crackdown on social-media and education firms has sent stocks tumbling. Companies with exposure to property are suffering as a result of a clampdown on leverage and a liquidity crisis at Evergrande, a developer. A ban on cryptocurrency transactions briefly knocked the price of bitcoin. And a rush by provincial authorities to meet carbon-emissions targets is causing power shortages, which could weigh on both the economy and asset prices.