Investors Are in Denial About China

The rules of supply and demand still apply.

Too much.

Photographer: Qilai Shen/Bloomberg

As you've no doubt noticed, companies and investors around the world are feeling the pain of China's economic slowdown. They're worried about all the layoffs, cuts to surplus capacity and deleveraging to come on the mainland, which will further depress demand. The natural temptation is to blame China for the world's woes. But outsiders should focus just as much on their own missteps -- starting with the widespread misperception that "this time" would be different.

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