The US stock market open has been Shanghaid by China’s 9% decline overnight.  That’s a substantial decline but it should not have been a Shanghai surprise.  I have already written on this topic earlier this month so click here to read my earlier thoughts (they still apply.)   I am not convinced that last night’s Asian problem is any more important than the slide a month ago, but it appears that this one MAY call attention to the risk associated with the returns in emerging markets like China.  Investors have been dumping huge money into these markets with a massive dislocation between risk and reward.   Hearing that China’s selloff was due to “profit-taking” was laughable at best.  If it’s false, then we should be looking for the real cause.  If it’s true, investors should be thinking long and hard about how a little bit of profit-taking can precipitate a move like that.  Instead, I fear ignorance and blind hope that this will just blow over and we can go back to a singular focus on how wonderful the returns are in emerging markets.   I was worried about the risk in International ETF’s (click here) last spring and was told that I was panicking.   I expressed my concern last month and it was ignored.   I don’t know what is worse - denial or ignorance but the effect is not on me, it’s on the investors that are going to lose some money.  The fact is that China’s government has been blatantly telling people for months that they are going to slow down the economy and slow down the markets.  I’ll be watching to see whether any selloff in the US is met with buy programs or whether they are going to let this play out.