Here's a perspective (ABC News):
With China being the second-largest economy in the world, investors around the world are anxious about the major slide in the Chinese stock market...
As a measure of how big the slide is compared to Greece's financial crisis, China's stock market is losing multiple times the value of Greece's GDP almost daily.
During deflation, the value of most financial assets go down except one: cash. Right now, with financial fear running rampant, cash is in high demand in China.
Read this excerpt from a July 8 Bloomberg article:
China's stock rout spread to the country's commodities markets as investors rushed to raise cash.
Everything from silver to sugar to eggs tumbled with the Shanghai Composite Index, which crashed to a three-month low on Wednesday. Government measures to stabilize equities are failing to stop a stock market collapse.
"People are selling everything in sight to get their hands on cash," Liu Xu, a trader at private asset-management company Guoyun Investment Co. in Beijing, said by phone. "Some need to cover their margin calls in the stock market, while others are gripped by fear that the Chinese economy will be affected by this crisis."
Metals including nickel and silver on the Shanghai Futures Exchange fell to their daily limits, while rubber entered a bear market. The volume of copper traded was almost six times the three-month average. Steel rebar and iron ore, as well as eggs, sugar and soybean meal dropped to the lowest level allowed by their exchanges.
You can read the entire article by following the link below: