As the US, as the biggest creditor and exporter in the late 1920s was hardest hit by the Great Depression, China now looks to be taking the global slowdown on the chin.
And in a further sign of distress, the Baltic Dry Index, a measure of contracting prices for dry cargo shipping (and seen as an indicator of international trade) continues to fall. Today it hit 684, down from a peak in May of 11.793. That is a decline of over 94%.
From Bloomberg:
House prices in Shanghai, Shenzhen and Guangzhou are plunging, and the global economy may grind almost to a halt next year because of it.Construction of homes, offices and factories fell at least 16.6 percent in October after rising 32.5 percent a year earlier, according to Macquarie Securities Ltd…..Building is the biggest driver of China’s expansion, contributing a quarter of fixed- asset investment and employing 77 million people….
“China is now at the heart of the global slowdown,” said Jim Walker, chief economist at Asianomics Ltd., an economic advisory firm in Hong Kong. “It means that global growth is probably going to be dragged down close to zero next year.”…
“The real estate sector has seen a particularly pronounced slowdown,” said Louis Kuijs, a senior economist at the World Bank in Beijing. “Real estate investment growth is now close to zero.”…
A second stimulus package to boost consumption may be imminent, the Beijing-based Economic Observer reported Nov. 24. Measures being considered include raising income-tax thresholds, higher salaries for state workers and increased subsidies for low-income groups, the newspaper said, citing people involved in discussion of the plan.
China has room to spend even more than already announced because it has debt equal to 15.7 percent of gross domestic product — compared with 75 percent in India — a budget surplus and the world’s largest currency reserves at $1.9 trillion, said Lu Ting, a Hong Kong-based economist with Merrill Lynch….
“If real estate contracts by 30 percent it doesn’t matter how much the government spends on infrastructure, the economy is still going to be very weak,” said Paul Cavey, a Hong Kong-based economist at Macquarie who forecasts a 6.6 percent expansion next year. “Property is the epicenter of economic weakness.”
Anonymous 
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House(kinda a joke since almost everyone in any size city lives in condos there) prices in China were pretty surprisingly high when I was there, about a third to a fifth of the prices in America depending on the city. This is in a country where the median incomes are much lower.
Other expenditures are much mo' lower too, though, and most of the purchases involve large amounts of cash down.
Home mortgages are not likely to hurt their banking system — though plenty of other things could, including C&D, and industrial loans — but it's coming right out of the hide of the owner. Should do wonders for consumer spending, but I don't think house prices are as critical an issue in China as in Australia, Spain, the U.K., or the U.S.