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GMO: Something's Fishy in China. GMO: Something's Fishy in China By Robert Huebscher January 17, 2012 A wide gulf separates the two most prominent views regarding China’s future.

GMO: Something's Fishy in China

Faced with slowing economic growth, one side says its leaders will deftly navigate a soft landing, while the other claims it will face an implosion similar to those that befell Japan 20 years ago and the US in 2008. The Reasons For China's Imminent Bust. Guest Post via The global dominant narrative about China is wrong, claims Gordon Chang.

The Reasons For China's Imminent Bust

Don't expect it to be the 'pocketbook of last resort' that will rescue world markets from their current malaise. And don't expect its remarkable economic growth to continue. In fact, expect a "hard landing" for China - and soon. 10 Signs of Speculative Mania in China. Inquiring minds are reading a GMO white paper on China’s Red Flags In the aftermath of the credit crunch, the outlook for most developed economies appears pretty bleak.

10 Signs of Speculative Mania in China

Households need to deleverage. Western governments will have to tighten their purse strings. China’s housing bubble: New evidence. For a while now, analysts have been arguing there is a bubble in China’s property market. Using records from 35 major cities this column finds evidence of a housing bubble. Ponzi in Peking - 'BMW town' crashes in pyramid fraud.

Chinese Quest for Shortcut to Greatness. He Chinese economy must be getting out of control, because the Chinese government is doing the unthinkable: It is desperately trying to put the brakes on the economy.

Chinese Quest for Shortcut to Greatness

When you pump a stimulus package that represents 14% of GDP through a fire hose into an economy, which was already on shaky bubble foundation, in a very short time you’ll have some serious unintended consequences — you’ll get super bubbles. To understand what’s taking place in China today, we need to rewind the clock about a decade. At that time the Chinese government chose a policy of growth at any cost. To achieve that, it kept its currency (the renminbi) at artificially low levels against the dollar — this helped already cheap Chinese-made goods become even cheaper than its competitors’.

The US and global consumers were eager to buy them. But China isn’t your local democracy, and it needed to grow at any cost. Systemic Fraud In China? China's high growth rates have encouraged foreign investment, which have in turn helped fund China's incredible growth.

Systemic Fraud In China?

But such large capital inflows are bound to give way to sector imbalances and fraudulent behaviour. Recently, some fraudulent behaviour has been uncovered among small-cap Chinese stocks that trade in the US. China’s Ghost Cities. The following video is the first of the great series on China’s ghost cities that Bloomberg is running this week.

China’s Ghost Cities

Getting China right is key to your P&L and the direction of many markets, including emerging equities and commodities. We’re grappling with who financed these cities, who is holding the paper, and how were they financed. Recall China’s massive money supply growth and credit expansion which funded the country’s stimulus after the 2007-8 financial collapse. Our basic assumptions may be wrong, such as time horizon and holding period, and Adam Johnson does a good job covering these, but this is one issue that keeps us up at night and we won’t rest until we’re comfortable with a good working understanding of what is going “over there.” China faces social unrest from housing woes - Emerging Markets Report. By Chris Oliver, MarketWatch Reuters A laborer works at a construction site for new houses in Huaxi, China.

China faces social unrest from housing woes - Emerging Markets Report

Analysts say falling prices in the housing market could lead to social unrest this year, although Beijing is unlikely to let such grumbling go too far. HONG KONG (MarketWatch) — Irate Chinese homeowners are among the top policy concerns for Beijing this year, according to analysts who say weakening house prices are stoking serious tensions. Hidden Losses And Little Reform: China May Be Slowing More Than You Think. In his latest Email review, Michael Pettis at China Financial Markets discusses financial reform (actually the lack thereof in China), as well as an observation on China's Growth.

Hidden Losses And Little Reform: China May Be Slowing More Than You Think

Pettis writes .... Three months ago during their 2010 Q4 conference, the PBoC said that they believed that the global economic recovery would continue in 2011, although they acknowledged a great deal of uncertainty. The PBoC also said that stabilizing the price level was their top priority, and the central bank planned to control the “main gate” of liquidity inflows and to bring credit growth to “normal” levels. China's Housing Bust: A Potentially Devastating Blind Side In 2012. If China’s Property Bubble Bursts. The cooling of China’s real estate sector is good for the economy.

If China’s Property Bubble Bursts

But the government is right to be worried about the social consequences of the bubble bursting. By Eve Cary for The Diplomat December 08, 2011. China's skyscraper craze 'may herald economic crash' China could be the next country to go bust, if its headlong rush to build ever-taller skyscrapers is a guide to its future economic health.

China's skyscraper craze 'may herald economic crash'

According to a study by Barclays Capital, the mania for skyscrapers over the last 140 years is a sure indicator of an imminent crash. It points out that the construction boom that threw up New York's Chrysler and Empire State buildings preceded the New York crash of 1929 and Great Depression. More recently, Dubai built a forest of skyscraping offices, hotels and apartment buildings, including the world's tallest, the Burj Khalifa, before it got into terrible financial difficulties. China Soaring Skyscrapers Latest Confirmation Of Housing Bubble, Barclays Finds. China’s inflation bust - So then, Chinese inflation is falling precipitously: China's Real Estate Bubble May Have Just Popped. For years analysts have warned of a looming real estate bubble in China, but the predicted downturn, the bursting of that bubble, never occurred -- that is, until now.

In a telling scene two months ago, Shanghai property developers started slashing prices on their latest luxury condos by up to one-third. Crowds of owners who had recently bought apartments at full price converged on sales offices throughout the city, demanding refunds. Some angry investors went on a rampage, breaking windows and smashing showrooms. Shanghai homeowners are hardly the only ones getting nervous. Sudden, steep price reductions are upending real estate markets across China. What makes the future look particularly bleak is the lack of escape routes. To continue reading, please log in. The Chanos Equilibrium Will Tell You When China's Financial Meltdown Begins.

At an October seminar of the Chicago Council on Global Affairs (CCGA), carnival economist Niall Ferguson promoted his new book, Civilization: The West and the Rest. He revealed the blindingly obvious as if it were a divine revelation: the U.S. has serious problems. He preached that the U.S. corrupted its six Ferguson-defined "killer apps": competition, science, rule of law, medicine, the consumer society, and a strong work ethic. Ferguson claims India and China have downloaded these killer apps and compares the West with a virus infected PC and the East with a fast Mac. Never mind that competition, science, medicine, trade, and industrious workers have been in evidence in India and China for centuries.

China's Ordos property bust offers warning sign. ORDOS, China (Reuters) - The monumental, neo-Mongolian sculptures, empty plazas and hulking concrete shells of buildings in Ordos district, deep in the steppes of Inner Mongolia, are a potent symbol of how China's property boom can turn to bust. Off the back of a thriving coal industry, the local government has been building a new city for one million people called Kangbashi. It sits virtually empty and property prices are falling. Even in the old city of Dongsheng where people live and work, some 45 minutes drive away, a wave of investment has backfired. Cranes sit idle over unfinished skyscrapers and migrant workers are fleeing.