Evergrande’s Struggles Reflect China’s Efforts to Rein in Multiyear Debt Boom

The troubles engulfing Chinese property developer Evergrande have prompted comparisons to the failure of Lehman Brothers in 2008.

Analysts doubt a replay of the contagion that followed Lehman’s collapse is about to happen in China’s more tightly controlled financial system. Yet the two events have something important in common: Lehman failed when a multiyear mortgage bubble deflated. Evergrande is struggling because China is trying to pivot away from a model of economic growth inordinately dependent on debt.