Monday, April 4, 2011

China update

World's Biggest Property Bubble: China's Ghost Cities Revisited; 64 Million Vacant Properties
I have done many stories on China's ghost cities. So have others. However, yet another ghost city story has come up recently that's worth a good look. 
Please consider the Dateline SBS report on China's Ghost Cities by Adrian Brown 
Vast new cities of apartments and shops are being built across China at a rate of ten a year, but they remain almost completely uninhabited ghost towns. 
It’s all part of the government’s efforts to keep the economy booming, and there are many people who would love to move in, but it’s simply too expensive for most. 
Video journalist Adrian Brown wanders through malls of vacant shops, and roads lined with empty apartment buildings… 64 million apartments are said to be empty across the country and one of the few shop owners says he once didn’t sell anything for four or five days.
... 
All this talk about how undervalued the Yuan is, how China will rule the world, and why the Yuan will be the next global reserve currency is pure silliness. 
China's growth is nothing more than a credit bubble on steroids. Cities are vacant, yet China keeps building, and building and building. 
The true state of affairs is China's banks are insolvent. China is building units for which there is little demand and few can afford. China will have to print money to pay for all of this malinvestment. The idea the Yuan is undervalued fails to take into consideration any of this.
Watch Hundreds Of People Get Run Over At An Intersection In China



An Eye-Opening Account Of What The Chinese Are Doing With All That Copper

A Stunning Look At China's Ghost Cities



Before China Crashes, This Is Going To Happen First

It Will Be A Huge Mistake If China's Tightening Cycle Ends Now

Hidden Losses And Little Reform: China May Be Slowing More Than You Think
Regardless of whether Chinese officials are "a little less concerned about domestic overheating" several facts remain
  • Inflation is still huge problems in China whether there is lessened concern or not
  • Chinese interest rates are too low
  • Price for the malinvestment and unwarranted infrastructure building is yet to be paid
  • China's growth is still unsustainable
  • Peak oil is a limiting constraint
  • China has the world's biggest property bubble and it will bust

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