As China unveils its latest gambit to prop up its ailing stock market, the line between being a much-needed lifeline or merely the first card in an elaborate house destined to collapse is blurring. Following the PBoC’s wide-ranging support package announced last week, the central bank unveiled a ¥500bn swap facility aimed at reviving its volatile stock market. The intervention comes after a tumultuous week that saw Chinese equities experience a dizzying ascent followed by a precipitous decline, erasing billions in market value.

Consequently, the PBOC's actions, while providing short-term relief, may be masking deeper structural issues. The constant need for central bank support could be seen as a form of financial life support, potentially creating a dangerous dependency. With each new round of stimulus, China's central bank interventions increasingly resemble a state-sponsored Ponzi scheme, masquerading as financial alchemy.