The Chinese stock markets plummeted Monday in the biggest one-day drop since 2007. The Shanghai Composite Index fell 8.5 percent, weighing on Japanese, Hong Kong and U.S. markets. The trend is raising doubts about the effectiveness of Beijing’s recent efforts to prop up the market, as well as the health and direction of the world’s second-largest economy.

The Chinese government has gone to huge lengths to support its volatile stock markets in Shanghai and Shenzhen, which climbed to dizzying heights in mid-June and then shed about a third of their value over the following month.

By early July, the Chinese government seemed to have halted the carnage by announcing a truly massive array of measures to support the market. It encouraged banks and other financial institutions to increase lending to investors, froze initial public offerings, cut interest rates, forced state-owned companies and funds to buy shares, and threatened to prosecute short-sellers. At one point, over half of the listed companies on the exchanges had suspended trading in their shares to stem further losses. The state-owned China Securities Finance Corp pledged to loan 21 securities firms about $42 billion to purchase shares.

The reaction has left the Chinese government heavily invested in its own stock market. The China Securities Finance Corp had borrowed a stunning 1.22 trillion renminbi from commercial banks to buy stocks as of July 13, according to financial media Caixin, and is now one of the top 10 shareholders of many listed firms, Chinese media reported last week.

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