For two years now, the prophets of doom have forecast that China is heading for a hard landing. But while China is not immune to the debt crises in the West, it is better positioned to cope with them.

Last Thursday, the People's Bank of China lowered the benchmark deposit rates by 25 basis points and cut lending rates by 31 basis points; the second time in a month. The cuts fueled concerns that there is more trouble ahead for the Chinese economy.

In fact, there is a lot of noise in the markets and three macro trends complicate the picture. Economic conditions are deteriorating in Europe, the hoped-for recovery is slowing down in the United States, and China's economy has been weaker than anticipated in early spring.