If you have not been paying attention to China's stock market, they are in big trouble.
Today's 3 year Shanghai chart looks more like the aftermath of our dot com bubble.
The Shanghai Index in in very serious trouble. Our Accelerator/Decelerator is showing that the index is in a strong deceleration trend and the Shanghai has a lot further to go before it stops.
Some investors may be thinking that this is not "our" problem. When the Shanghai drop finishes, a lot of wealth we be washed away and China will have to focus their funds on supporting their economy and financial structure. That means they will have a diminished interest in buying our Treasury Bonds ... and that will spell trouble for the U.S. Our government will have to raise the interest on the bonds to entice buying, and that will mean higher interest and mortgage rates for Americans. The other alternative isn't much better ... higher taxes.
See today's link for the Shanghai chart and our look at the VIX vs. the S&P 500.
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