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by Lance Roberts
Real Investment Advice
China Matters
Over the past few days I have repeatedly heard the following statement:
“China isn’t that important as it is only 7% of the U.S. economy.”
While that may be a true statement in relation to the economy, it is a far different matter when it comes to the financial markets.
With financial markets so closely correlated, what happens in China has a direct and immediate impact on U.S. markets. Beginning in 2014, China financial markets went parabolic as investors levered up to speculate. This is not the first time this happened, and is a sharp reminder of why the perils of leverage should not be readily dismissed.
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