Thirty years ago, China did not have much of a middle class. A large number of people who have recently moved to big cities for jobs in the fast-growing economy still lived in rural areas then. China's increasing role as an exporter changed that.

As Chinese began to see wage improvement, these people not only became consumers of goods, they drove a thriving stock market and real estate prices. A lot of that is about to end.

According to The New York Times, "Chinese factories reported a plunge in new orders last month. Exports are barely growing. The real estate market is weakening." Some of the immediate fallout of that will be good for the West. China may need less oil and a smaller supply of metals commodities. That could bring down the prices of these and cut back inflation in big economies like the U.S.

The less pleasant side of the coin is the U.S. exports to China will almost certainly slow, putting pressure on corporate earnings here.

The worst case is much worse, and looks like Japan in the 1980s. A boom in exports helped drive inflation in Japan. The value of its real estate and banks sky-rocketed. Japanese businesses started to buy up U.S. assets. When growth in Japan slowed a bit, the value of real estate and the stock market in the country collapsed. Money from Japan used to buy U.S. treasuries disappeared. So did the demand for U.S. goods and services. No one was a winner.

It is hard to imagine a recession in China as it has a GDP growth rate of nearly 10% and has been growing faster than that for years. But Japan's problems thirty years ago are a warning. Nothing good lasts forever.

Douglas A. McIntyre is an editor at 247wallst.com.