On Friday, China was awarded the 2022 Winter Olympics, which will make it the first country with a city, Beijing, to host both Summer and Winter Games. But that wasn't the big news out of China in the past week. A huge slide in the Chinese stock market on Monday and Tuesday brought the July decline in the Shanghai Composite to nearly 15 percent. It's down by twice that much going back to mid-June. Roughly $4 trillion in market value has been wiped out. At this point in China's stock-market spiral, it's too soon to really know how big a deal it is. The basic point that everyone agrees on: China's growth is slowing. The most recent reports put GDP growth at a 7 percent annual rate, well below the 8 percent to 14 percent rate China has sustained for more than 20 years. But there's lots more in dispute.

An investor watches stock prices in Shanghai, China. Aly Song | Reuters

Foreign investors are avoiding China. The country's equity exchange-traded funds suffered outflows on 14 of 17 trading days in July, totaling $1.1 billion, or 5.9 percent of assets, research firm TrimTrabs said in a statement on Tuesday.

There are good reasons to fret about what happens next in China, as well as rational economic arguments to make that a looming Chinese bear market will at worst resemble the 2000–2002 U.S. tech bust—which caused only a mild recession—rather than anything like an Asian version of the 2008 financial collapse. To help make sense of the wild ride in China that has world markets on edge, consider the following nine debate points:

1. Chinese stocks are not the Chinese economy.

Chinese companies don't usually use the stock market to finance their growth. According to economic-consulting firm IHS Global Insight, only 5 percent of China's private investment is financed by the stock market—down from 25 percent in 2007. The rest comes from bank lending, and Chinese authorities have made clear that they will make sure the banks have money to keep lending. Read MoreWall Street is losing its love for Chinese stocks

Movements in China's stock market, housing market and corporate profits have had little correlation. And even though the Chinese market is heavily influenced by very active retail investors, only 15 percent of Chinese households own stocks and only 6 percent of household assets are in stocks, so consumption should be little affected, IHS stated. 2. Valuations for most companies, while high, are not nuts.

Before June, the average Shanghai exchange stock traded at a price about 40 times higher than companies' profits, down from 70 before a bust in 2007. That was already down to about 27 by early July, according to a Merrill Lynch calculation, and while those numbers are higher than in the U.S., the U.S. economy's growth rate is less than half of China's recent 7 percent annual clip. 3. Chinese bonds are holding up fine.

Chinese 10-year bonds are yielding less than 3.5 percent interest per year, not as low as bonds from slower-growing European or North American nations, but nothing suggesting investor panic. In fact, Chinese bond yields have fallen through most of 2014 and 2015, according to Trading Economics. Other interest-rate measures like bond spreads have also stayed stable.

4. The government is on the case, and that's pushing money into the market.

The Chinese government borrows in its own currency, unlike Greece for one, and that gives authorities the flexibility to push as much money into their financial system as it takes to keep any contagion from forming. Beijing has also been quick to encourage Chinese institutions to put money into the market, which has until this week had reversed institutional fund flows out of mainland stocks. And officials are threatening to crack down on short selling, in a bid to make bearish investors less influential and effective. 5. Bear markets in China are nothing new. In fact, Chinese stocks spend most of their time in a bear market. The Shanghai Composite Index has experienced 10 bear markets in the last 25 years for a total of 188 months, according to Tom Lee of Fundstrat Global Advisors. That means China was in a bear market more than 60 percent of the time.

So big swings in stocks are nothing new to China and, in the past, have not caused a collapse in U.S. stocks or the global markets. Read MoreChinese farmer invested in stocks, lost everything

