The shanghai composite crash
The Shanghai Composite Index, which is China's version of the Dow Jones Industrial Average, dropped a whopping 8.4%, which is its steepest one-day fall since 2007.
China is one of the world's largest economies, but also one of the most fragile. In the last few months, its stock market has seen an incredible rise in prices. Those prices have now been crashing down; causing broader concern about the impact a Chinese economic meltdown could have on the rest of the world. After the China stock rout, Indonesian and Malaysian currencies are back at Asian crisis levels. This isn't just China's problem. Over the past few years, Major American companies depend on the health of China's economy, and its stock market, for their revenues. Apple points to its growth in China as a bright point; with $13.2 billion in sales there, China is the company's second-biggest market after the U.S. with revenues jumping 112% in the past year. China and its taste for mass luxury is why the gold iPhone exists.
Chinese stocks lost about $3.9 trillion in value. It looked like the market could be on the verge of a total collapse.
Due to the wild swings, more than half of listed Chinese companies have taken the drastic step of suspending their own shares. That's right: half the companies on the Chinese stock market aren't even trading, and stocks are still crashing.
The Chinese government is working furiously to avert catastrophe in its stock market. They're doing this the good, old-fashioned way — by pouring in billions of dollars in cash.
China is using a state-owned company — China Securities Finance Corp. — to lend money to people that can, theoretically, be used to buy stocks. This is meant to buy up shares to keep prices from falling.
China is a drastically important company to the world economy. The country imports more than $1.4 trillion of goods