IF IT ISN’T ONE DAMN THING…: China to export deflation to the world as economy stumbles.

Global investors expect falling prices in China to push down inflation rates worldwide this year, as excess capacity in its slowing economy prompts Chinese exporters to cut prices on goods they sell abroad.

Prices of Chinese exports have been falling at their fastest rate since the 2008 financial crisis, indicating the world’s largest exporter is starting to send deflation outward to developed economies that have been battling high inflation.

“China will be exporting deflation to the rest of the world, and you will find various countries dealing with the fact that China has built up overcapacity,” said Chetan Sehgal, lead portfolio manager at Templeton Emerging Markets Investment Trust, a UK-listed fund.

But then there’s this: The Global Tremors From China’s Real Estate Crisis Are Only Just Starting.

Chinese investors and their creditors are putting up “For Sale” signs on real estate holdings across the globe as the need to raise cash amid a deepening property crisis at home trumps the risks of offloading into a falling market. The prices they get will help finally put hard numbers on just how much trouble the wider industry is in.

The worldwide slump triggered by borrowing-cost hikes has already wiped more than $1 trillion off office property values alone, Starwood Capital Group Chairman Barry Sternlicht said last week. But the total damage is still unknown because so few assets have been sold, leaving appraisers with little recent data to go on. Completed commercial property deals globally sank to the lowest level in a decade last year, with owners unwilling to sell buildings at steep discounts.

Regulators and the market are nervous that this logjam could be concealing large, unrealized losses, spelling trouble both for banks, who pushed further into bricks and mortar lending during the cheap money era, and asset owners.

Interesting times…