China: it was coming

I have to say, I saw China's steep decline coming at the beginning of the year:

Doubts over the sustainability of last year's boom raise the question of whether 2007 is the next 1997, when Thailand's currency devaluation sparked the so-called Asian contagion: bouts of panic-selling in Asian markets that spilled over into other emerging markets and, eventually, developing ones as well.

"What's often forgotten, I think, is that the way we correlate risk in Asia is very high," says Sean Darby, head of Asian strategy at Nomura Holdings in Hong Kong. "We're almost certainly due for a correction this year."

By tomorrow, we'll all have a clearer idea of how far the Chinese market declines are headed: will blog more. Meanwhile, the article helps explain some of the reasons for the decline.