China's Economy Faces Dangerous Property Bubble

Photo from Marc Faber's Blog

'China Syndrome' Means Country Faces Dangerous Property Bubble -- The Telegraph

One of China's leading economists has said that the country is facing the possibility of a dangerous real-estate bubble and rising inflation which could put growth at risk.

Yu Yongding, senior fellow at the Chinese Academy of Social Sciences (CASS) and former member of the monetary policy committee of the People's Bank of China, said that the demand for new property was so high that prices were in danger of soaring out of control.

Speaking at the World Economic Forum in Davos, Mr Yongding said that China's authorities would have to act to calm the market and that the rate of growth would have to be lowered: "Definitely inflation is the biggest concern so far. At the same time we are concerned about a real estate bubble.

Read more ....

My Comment: The Telegraph has another Article that reveals the seriousness of China's housing situation. That post is here.

Will The Chinese Yuan Become The Global Currency Of Choice?

China Pushing For Yuan To Be Global Currency -- Voice of America

Business leaders have mixed views about how soon the Chinese currency might replace the dollar as the world’s dominant currency as Beijing promotes greater use of the yuan. Some say Beijing must carry out more reforms for that to happen.

Even as the United States and other countries complain that China’s yuan is deliberately undervalued, Beijing is pushing to make its currency more internationally accepted, commensurate with its growing economic influence.

Read more ....

My Comment: There is an air of inevitability to all of this .... it will be sooner (not later) that the yuan will be a major international currency equal to (if not greater) than the U.S. dollar.

Concern`s About China`s Economy Are Now Starting To Surface

Mark Hart of Corriente Advisors has started a fund based on the belief that China is an 'enormous tail-risk'. Photo: ALAMY

Hedge Funds Bet China Is A Bubble Close To Bursting -- The Telegraph

The world is looking to China as a springboard out of recession - but some hedge funds are betting the country's credit and growth levels cannot be sustained.

For his first-ever speech as Britain’s new Minister of Trade & Industry last week, Lord Green faced a formidable audience of 400 Chinese and British business delegates.

The former chairman of HSBC declared that China’s economic growth figures over the past five years represented an “extraordinary historic event”.

Green didn’t need to go over Britain’s experience during the same period for most to agree that plugging into China’s blistering growth - predicted by the IMF to be 10.5pc this year - was of “vital importance” to the UK.

Read more ....

More News On Concerns Over China`s Economy

China's economy grew 10.1 pct in 2010: official -- Reuters
China's Money-Printing Addiction Could Spell Disaster -- Business Insider
China reserve requirements raised to tame inflation -- Strait Times
China raises RRR for banks for seventh time to curb inflation -- Economic Times
China should be cautious of inflation, excess liquidity: economist -- Xinhuanet
On the Size of China’s Economy, a Dissenter -- New York Times
Understanding China’s Economy -- Yukon Huang, Carnegie Endowment
China’s Economy: Action vs Rhetoric -- Yukon Huang, The Diplomat
There is no need to fear the China syndrome -- Merryn Somerset Webb, Financial Times

My Comment: It is the Chinese economy that drives much of the global economy right now .... any disruptions will spell suffering and hardships for many countries who are now dependent (for better or worse) on this type of growth.

China Is Now The World's Biggest Energy Consumer

China Passes U.S. As World's Biggest Energy Consumer -- Wall Street Journal

China is now the world's biggest energy consumer, knocking the U.S. off a perch it held for more than a century, according to new data from the International Energy Agency.

The Paris-based agency, whose forecasts are generally regarded as bellwether indicators for the energy industry, said China devoured 2,252 million tons of oil equivalent last year, or about 4% more than the U.S., which burned through 2,170 million tons of oil equivalent. The oil-equivalent metric represents all forms of energy consumed, including crude oil, nuclear, coal, natural gas and renewable sources such as hydropower.

Read more ....

My Comment: Everyone in China wants to own a car. Expect this trend to quicken as more and more Chinese enter the middle class.

China’s Economic Power Unsettles The Neighbors

From The New York Times:

PASARKEMIS, Indonesia — In the Dickensian depths of the Dunia Metal Works here, all is cacophony: the bam bam bam of grease-drenched punches; the rhythmic clank of unspooling steel wire; the storm and stress of glinting, freshly minted nails cascading onto a broad metal table for boxing.

But for all the industrial din, Dunia is undergoing a painful slump. Today it runs at 40 percent of its capacity, its domestic nail business imperiled — and its exports wiped out — by cheaper Chinese alternatives.

Read more ....

My Comment: If China's economic power unsettles them, just think how much China's growing military power raises the concerns in these countries.