.. fascinating and more than a bit worrisome.
I’ve been to China a lot Mish, spent many months at a time there for the last eight years. China is already in a massive overcapacity real estate bubble. They are building three apartments for everyone that is lived in. Most apartments are empty and those that are rented do not come close to paying the interest on the loan.
There are huge department stores with products loaded on the shelves and staff everywhere and no one is shopping! Staff outnumbers customers five to one. It’s surreal. They are ready, waiting for a great wave of shopping to come, but no wave is coming.
Eventually this “borrow and build” economy will be a pop heard round the world. China runs on construction, build build build, but there is no reason for that many places and spaces and big mall businesses with no consumers.
So, what do you think will happen if our biggest bank (China owns most of our foreign debt) goes belly up? What then ye owners of almost $11,ooo,ooo,ooo,ooo.00 in debt? What then?
If China’s bubble bursts, we can expect very bad ramifications in this country. Some folks I know suggest that we stock up on canned goods, vegetable seeds for gardens and that we get ourselves some chickens or ducks.
What do you think?