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China's economic slowdown and unprecedented devaluation of Yuan
A chain of events is unfolding as sovereign governments and central banks have subscribed to the idea that they can keep their economies from faltering with aggressive monetary and fiscal policy:
2000 Excessive US monetary policy fuels consumer demand.
A common story at the time: High school boy sells his bedroom dotcom business for 500 million dollars!
US housing boom. Your gardener buys $600,000 house with no down payment.
China makes inexpensive products for the west.
High demand for raw materials. Suppliers plan expansion.
2009 Qe US. Zombie companies created. Western consumer demand cools.
China looks inward for demand, makes real estate.
Long lead raw material expansion projects come online. Capacity is unprecedented.
Qe Europe
Qe Japan
Qe China
Commodity prices fall due to oversupply and lack of demand.
They do it so they can keep monopolizing the retail market on electronics, clothing, plastics, beauty accessories, etc etc, basically everything you see for sale on Alibaba
If their currency keeps rising, then so does the value of the goods. We can't have that now. USA might be able to compete with them then.
It could as easily have been moderate negative.... The fact is that I don't know, and don't have the tools or knowledge to judge. But I think that any disruption to a huge economy has potential effects everywhere else; I assume negative because that's sort of the default for a disruption, and I think it is likely "slight to moderate" because the US economy, and the rest of the world's, is also huge and should be fairly resilient. So I come down to negative, but not so bad.
You didn't put "Don't have a clue" as a choice, so I couldn't pick that.
But even though I can't be at all sure, I will go with my best take on it, which is negative but not real negative.
