Posted on 05/19/2010 5:27:16 AM PDT by C19fan
One of the most popular debates in global macro circles currently relates to China and whether its economy is in a bubble. One the side of the bubble callers is one of the more successful short sellers of our generation, James Chanos. Admittedly, Chanos is usually on the right side of these big calls and, for the time being, I'm not going to debate him. Great Chinese bubble debate aside for now, how does Chanos's theory hold up in light of the data we've been reviewing?
Data from various sources within China that we've seen over the past few weeks has pointed us directly towards one simple conclusion: China is experiencing serious inflation. Some of the keys for us include:
(Excerpt) Read more at money.cnn.com ...
“Unexpected”.
I’ve been saying for a year that the Chinese (read “emerging markets”) economy is a bubble, a complete illusion.
At its core, how can you trust any economic indicators from a government that murders its own citizens.
Also, evidence has it that China built many 50-story buildings, which are now unoccupied, except for the bottom floors, which have been taken up by ex-farmers who are squatting in them, unable to find work.
They built many highways, which are not being used.
Many homes were bought at bubble-prices, encouraged and backed by the government.
China’s electricity usage is in the tank, strange for a strong economy.
In short, the “emerging market” pumpers (e.g., Jim Rogers) had a vested interest in Asia replacing America as the next economic hot-spot. They had no problem abandoning America and moving to Singapore.
Well, I wish all those fair-weather patriots great hardship.
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