After thirty years high economic growth，Chinese economy is stepping into a classical transition from industrial economy into post-industrial economy. In this transition period，mismatch between demand side and supply side is enlarged due to over regulations in service sectors，and economic growth engine is weakened. Stimulus policies aim to keep economic growth momentum at expense of sharp increase of financial fragility and resource misallocation，which is unsustainable and harmful to sustainable economic growth. China’s economic transition syndrome refers to such a vicious cycle among slowing down of GDP growth，increasing demand for stimulus policies，and increasing financial fragility.