One of the unintended benefits of China’s very tight regulations on their finance sector, is that their finance sector ended up being limited access and mostly closed off to foreign parties, so although there is exposure to the west on stuff like this (of which more are coming), it isn’t nearly as bad as it could have been otherwise.
Normally a financial crisis with the size of their economy would probably set off a chain reaction that would be catastrophic to the global financial market. But in this case there will be a significant but manageable hit to the rest of the world. Inside China though, I think we could see a replay of the Great Depression, or what happened in Venezuela the last 15 years.
Inside China though, I think we could see a replay of the Great Depression.
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According to Statista their debt to GDP ratio is 82 percent, the US 130 percent.
That gives their Central Bank a lot of tools to paper over the problem.