Word that Chinese imports may be significantly muted by the economic turndown sent shock waves through the oil patch. While crude prices have dropped about 5% over the last few trading sessions, Chinese share prices are down by double that amount.
Perhaps the Middle Kingdom is looking at the situation in the wrong way. With more English-speaking folks in China than there are in the U.S., what could potentially be the largest middle class in the world is right in their backyard. Thanks to government reforms that began only ten years ago, this demographic owns an apartment or house, takes vacations, and is familiar with leading foreign brands.
If the growth of this emerging middle class continues, it could become a significant consumer. This would serve to reduce the current account deficit of the U.S., propelling our domestic economy out of the malaise in which it is currently entrenched.