Tuesday, August 19, 2008


Scary chart on the Chinese stock markets recent performance. A lot of people are losing a lot of money. Don't forget, China is the US's largest (maybe 2nd largest to Japan) creditor. When your creditors are under stress, you begin to feel the stress. Would China ever stop buying our bonds (which keeps are interest rates low) and put the money into their own economy? Or maybe try to prop up their stock market by using that money to buy broad indexes?

I don't know what they'll do, but that is a code red chart and spells danger for everyone dependent on China.