There is no shortage of doom and gloom talk regarding China. Am I missing something or weren’t the alarmists only a few short months ago suggesting China was going to become the world’s reserve currency? Now the world is ending because they are devaluing their currency? Which part of this gloom and doom story are we supposed to follow?
I can recall (from the mid-1980’s) how we were all going to work for the Japanese, the number two economy in the world that was seemingly destined to become the number one economy. Then things changed.
Suddenly, Japan collapsed in 1989-90. I still remember how the negative pundits spun their stories of gloom and doom for the U.S. stock market.
While seeing the number two economy in the world in a deflationary turmoil was worrisome to investors, the pessimists, of course, could not have been more wrong. The stock market returns over the next decade were nothing short of stellar.
By the way, if find it rather difficult for me to be overly concerned about a country that is responsible for 0.7% of U.S. exports and only 2.2 % of the investable universe.