Well, pretty much anyone who is not an economist or Wall Street "strategist" because a mercantilist, export-dominated nation pegged to a currency that has appreciated by an unprecedented amount in the past year, is grounds for nothing short of disaster, or using the parlance of our times, a "hard-landing."
Case in point: this is what we said just two days ago when the news of China's dramatic trade collapse hit in a post titled: "Chinese Trade Crashes, And Why A Yuan Devaluation Is Now Just A Matter Of Time."
So while one can repeat that the PBOC will have to lower rates again until one is blue in the face (even as out of control soaring pork prices make it virtually impossible for the local authorities to ease any more), the realty is that, as we warned in March, a Chinese QE is now inevitable. Why? Because while the government is already clearly buying stocks thereby validating the "other" transmission mechanism, the only thing the PBOC still hasn't tried is to devalue the Yuan. As global trade continues to disintegrate, and as a desperate China finally joins the global currency war, it will have no choice but to devalue next.
It took 48 hours for this prediction to come true.
Now the far bigger and more important question, when one strips aside all the politically correct BS that China is merely doing this to fast track acceptance into the SDR and to make life for "evil speculators" easier, is how will Japan, South Korea, and all the rest of China's Asian peers respond and avoid what is now an all-out race for the devaluation bottom, something which led to the Asian crisis of 1997.
Most importantly, did the PBOC just crush the Fed's rate hike intentions as China has done nothing short of announce the start of a currency war with the US, because the Fed strengthening the US Dollar in a world in which even the country's that until now has been strictly pegged to the dollar now admits the USD is too strong, will - and should - lead to many questions chief among which is why is Janet Yellen suddenly so focused on crushing multinational corporations' profits and just what is the US getting in return aside from the relentless capital inflow into an S&P which even Yellen admits is very much overvalued?