It'll be interesting to see how this crash affects the Chinese macroeconomy, and how the central bank and macroprudential regulators tackle it. I'm actually really excited; it'll be cool to witness first-hand just how stock market crashes impact economies.

Although, to be honest, the crash is probably a result of already weak underlying fundamentals. AFAIK, the Chinese government has long had a very loose credit policy, encouraged mis-allocation and frequently misreported levels of government debt. Given that China hasn't yet begun its deleveraging cycle, I wouldn't be surprised if it faces recession.

Basically I think this comes down to the Chinese government trying to stop the economy from shifting to export-led growth to domestic consumption-led growth. A lot of the appreciation in stock prices has been fuelled by a debt-financed government binge, which wasn't sustainable and now the debt's dragging on the economy. If this is correct, expect a lot of debt overhang and a fairly nasty recession.

Unless, of course, China's central bank can maintain nominal spending/devalue the currency.