It’s not as if investors didn’t already have enough to worry about with the Greek crisis, Puerto Rico’s default, the Iranian nuclear agreement, ISIS, the Fed ending its zero-interest-rate policy in the near future, and gurus such as GMO’s Jeremy Grantham proclaiming that the market is vastly overvalued based on the Shiller CAPE 10 ratio. But we now have alarm bells going off from the world’s second-largest economy, China, where slower economic growth is expected.
Concern over slower growth in China has led to sharp sell-offs in many emerging market countries. Those concerns spilled over to the markets of developed economies last week. After closing at 2,012 on Monday, Aug. 17, the S&P 500 fell 0.5 percent on Tuesday, another 0.8 percent on Wednesday, 2.1 percent on Thursday, and 3.2 percent on Friday.
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