CHICAGO--(BUSINESS WIRE)--Mesirow Financial Chief Economist Diane Swonk challenges assumptions that discount the potential impact of a Chinese slowdown. “Multinationals have become more dependent upon production and sales in China for their profits. As much as 20% to 40% of their profits are now derived from China.” She warns that “the effect that such an unstable behemoth could have on the global economy is unprecedented.”
Worries about the strong dollar and falling exports have a counterbalance in the form of more robust U.S. consumers. Diane Swonk says they are in good enough shape to withstand those headwinds blowing from the general direction of China. “Mortgage debt as a share of GDP has fallen to precrisis lows, while credit card debt as a share of GDP has dropped to 1994 lows.” Consumers now have the ability to take on a heavier share of spending.
Read the October issue of Themes on the Economy® to learn how the timing and trajectory of interest rate hikes has shifted with uncertainty in the global outlook. Archived issues can also be found at mesirowfinancial.com.
Mesirow Financial is a diversified financial services firm headquartered in Chicago. Founded in 1937, it is an independent, employee-owned firm with approximately 1,200 employees globally. With expertise in Investment Management, Global Markets, Insurance Services and Consulting, Mesirow Financial strives to meet the financial needs of institutions, public sector entities, corporations and individuals. For more information about Mesirow Financial, visit its website at mesirowfinancial.com.