This article illustrates a piece of the puzzle, i.e. who was pumping money into the Chinese real estate market in the boom years. It turns out that it was a lot of Western banks and private equity firms that are now facing huge losses.
http://www.nytimes.com/2009/04/03/business/global/03realestate.html
One thing that the article didn’t mention is *why* Chinese real estate companies went to Western banks for funding, and it was because the Chinese government wouldn’t let Chinese banks touch the stuff, largely because the government had just bailed the Chinese banks out once before and weren’t about to do it again.
