The Year of the Monkey is off to a bad start, with the Hang Seng sinking 3.9% in Hong Kong today. Investors are worried that China’s economic problems may be deeper than previously thought. Mainland markets remained closed for the holiday.

Adding to monkey business concerns, Kyle Bass penned a letter to investors saying he thinks China’s banks may face losses four times greater than those suffered by U.S. banks during the 2008 financial crisis. He thinks China eventually may have to print up to the equivalent of $10 trillion in yuan to recapitalize its banks, causing the Chinese currency to plunge more than 30 percent against the dollar. “What we are witnessing is the resetting of the largest macro imbalance the world has ever seen,” Bass wrote. “Credit in China has reached its near-term limit, and the Chinese banking system will experience a loss cycle that will have profound implications for the rest of the world.”

Bass has cred with investors because he correctly bet against the U.S. mortgage market in 2007. But not all his calls are so prescient. He wagered on a collapse in Japan’s government bond market in 2010 – a bet that other bond investors later nicknamed “the widow maker.” So take his warning with a splash of soy sauce.

For her part, Fed Chair Janet Yellen told Congress yesterday that there are good reasons to believe the U.S. economy will stay on a path of moderate growth that will allow the Fed to implement its plan for gradual increases in interest rates. But Yellen acknowledged that problems in China could impede economic growth.

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