The Shanghai stock index went down 9% last Tuesday and then brought down European and American stock markets with it. Rumors that the Chinese government would impose a 20% capital gains tax encouraged a sell-off. A report by the US Commerce Department of a big drop in orders for durable goods (that is, goods that last more than three years such as cars and furniture) combined with the effect of the Shanghai drop to bring the Dow Jones industrial average down 416 points, the biggest drop since the first day of trading after the September 11th attacks. Wednesday, after Chinese regulators denied the rumors about the new tax, US and Chinese markets recovered a bit, but European and other Asian stock indexes remained low.