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Why the China Crash is Bad News for Manufacturers

NEW YORK (TheStreet) -- While analysts anticipate a quick rebound from the global correction triggered by Chinese equity markets, manufacturers will be grappling with challenges in the world's second-largest economy for much longer.

Short-term volatility in the Shanghai Composite Index, exacerbated by Beijing's maladroit currency manipulations, is just the tip of the iceberg: The larger narrative signaled by the crash is the shift in China's economy away from international asset investment and toward domestic consumption.

"There's going to be less emphasis on heavy machinery, mining, industrials," Greg Lesko, a portfolio manager at Deltec Asset Management, said in an interview, "so those companies are going to face longer-term resistance."

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"We're seeing difficulties in iron ore with players...


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