Incredible amounts of wealth flowed into China for the last few years because China was the success story seen as a safe haven, at least compared to the rest of the world’s economies. The recent devaluation and market correction have convinced many people that China is not as safe as it was, and the money begins to flow back out again. As it flows out, China is trying to manage the impact, possibly worsening China’s situation. Within finance, everything is temporary, so this may be so, too. If not, China’s bubble may have burst and some new safe haven will be identified.
(Click on the graph for the link.)