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US Resilience to China Slowdown Questioned in Fed Risk Study
China’s stumbling recovery this year has produced a string of reassurances that the impact on the US of even a sharp downturn in the world’s second-largest economy will prove limited. Just last month, economists at Wells Fargo estimated that if China’s total output dropped by a cumulative 12.5% over three years, US growth would dip 0.2 percentage point in 2025. And Nobel laureate economist Paul Krugman recently concluded that, as to whether a debacle in China similar to the US crisis of 2008-09 would would “pretty clearly” not result in major global spillovers. A little-noticed study by the Federal Reserve ... (full story)