Knowing China's economy is slowing is like knowing you can save 15% or more on car insurance with GEICO. Everybody knows that.

But fewer people are focused on the magnitude of China's slowdown, much less considered the potential far-reaching implications for U.S. policymakers, investors and consumers.

Data released this week for the January-February timeframe have raised alarm bells among China watchers. Notably:


-- A 6.8% year-over-year growth in industrial production is "the weakest year-over-year reading ever (China’s IP data starts from 1995) outside the global financial crisis," according to Goldman Sachs.
-- Year-over-year retail sales growth of 10.7% is the lowest in over 9 years, according to IHS.
-- A 13.9% year-over-year increase in fixed-assets investment is the lowest in 14 years, according to IHS.
-- The Producer Price Index fell 4.8% vs. the prior year, the steepest drop since 2009.
-- Electrical consumption rose just 1.9% year-over-year after climbing 3.2% in 2014, the weakest in 16 years.

Behind Canada, China is America's second-largest trading partner and the U.S. ran a $342.6 billion deficit with the Middle Kingdom in 2014, according to the Census Bureau. A weaker renminbi would exacerbate America's trade deficit with China but most observers believe the U.S. economy is strong enough to withstand China's slowdown, this morning's weak retail sales data notwithstanding.

Garcia largely agrees and says "the biggest danger" China poses to the U.S. is "a meltdown of its financial system, and the societal fallout from that. If current easing policies help alleviate that, then they will have been worth it" -- for China, the U.S. and the world at large.

http://finance.yahoo.com/news/china-142313872.html