China's consumer economy is losing steam

In the second quarter, China’s economy grew at 4.3% from the year before, a pretty steep decline from the first quarter, when GDP was 5%. It’s also the country’s slowest pace in years. One of the biggest causes? Consumers and small businesses.

“They've got a bunch of domestic consumption that's very weak and is getting weaker, and they've got a small business sector and private sector outside of tech that's not investing,” said Adam Posen, president of the Peterson Institute for International Economics. “You take away the housing boom that they had a few years ago and it's not much of an engine for the world's second biggest economy.”

“Marketplace” host Kai Ryssdal spoke with Posen about why consumers are pulling back in China, and what that means for the rest of the global economy.

To listen to the interview, use the media player above.