They are reining in local companies carry-trading USD/CNY on the expense of PBoC. It's been the land of the scams and fast money for a long while. Finally they're trying to change that. If they could further rein in the de facto monopoly by state-owned enterprises and provide more room for private enterprises to grow, the foundation would be in place for another decade of sustained economic growth, before they have to face the baby-boomer retirement problem that developed world is struggling with now.

I don't know when the Chinese market ( iShares FTSE Xinhua China 25 Index ETF ( FXI)) will calm down and turn around. But I don't think this is a systemic crisis. Considering how long and how badly the Chinese financial system has been managed and distorted, a proactive bubble bursting is very much necessary and healthy.

Ironically, this is only possible with the combination of the new leadership and the complete lack of independence of Chinese central bank. If they succeed in bursting the financial bubble and forcing the economic transformation without devastating the real economy, it would be a monumental achievement in the history of monetary policy. I wish them best of luck.

If you're lucky enough to have dodged the recent rout in Chinese market, it may be time to slowly ease into some exposure as part of diversification. No hurry, though, as short-term downside risk is still high and could last awhile. But it deserves close attention and could be one of the best long-term investment opportunities that do not depend on black swans.

At the time of publication the author is long FXI.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

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