What Happens When China Goes "Pop"?

Hedge fund mogul James S. Chanos is betting that China's economic boom is about to go bust. (See the story in this afternoon's New York Times.) Not everyone agrees that China is a floating economic bubble on the verge of disappearing, but Chanos has a strong track record. He forecast the Enron collapse along with a number of other such predictions. Chanos argues that the evidence lies in the quantity of credit China is accumulating. Currently, the country is producing whopping quantities of goods predicated on the notion that there are actually consumers who will want them.

The big question has to be what happens to the world's economy when its banker goes "pop"?