Humint Events Online: Chinese Ghost Cities

Friday, December 17, 2010

Chinese Ghost Cities

This is interesting-- huge developments in China with hardly anyone there. Estimates of 65 million homes.

This analysis is interesting too, and kind of scary:
Sixty-five million homes are vacant in China and the estimate is that the country is still erecting 20 new cities a year. Now even if these are small cities, that's still a lot of real estate. The idea of course is that China wants to urbanize about 400 million impoverished farmers who still haven't benefited from China's march to modernization. That's the reason for this frenetic pace. With a billion people urbanized, China would be in a better position to build a full-on American-style economy. ...

... what is actually going on in China is a desperate attempt to build a consumer society before they run out of countries to export to. Seen from this perspective, the Chinese Communist Party is not acting out of ideological goodness but from a sense of self-preservation. Urbanized populations are easier to control; they are more malleable and consumerist.

In order to urbanize, the Chinese leadership has inflated rapidly. The Chinese central bank has obviously been printing money 24-hours a day. And foreign currency continues to flood in as well. The Chicoms have supercharged the economy in order to herd the remaining Chinese into these new, suburban environments before the economy becomes unmanageable and price inflation spreads beyond food and real estate to every other part of the economy.

When China crashes – as we believe it must – Asian economies will go down with it. Japan is struggling now but will be in a much worse position if China sinks into depression. And the Asian Tigers (as they were once known) will have plenty of problems as well. But that will pale in comparison to the problems that Europe and America will face when China finally lapses economically. (We freely admit we cannot provide a timeline.)

Ultimately, these central-banking-based consumerist economies are non-starters. Keeping these kinds of economies going is like running an elaborate juggling act with the knowledge that sooner or later all the balls will be dropped – that such a result is an inevitability. We return therefore to the uncomfortable insight that the Western power elite is well aware of the eventual fate of nation states that practice central banking (most of the world these days) – and that this may be one reason for the moratorium on Chinese economic speculation.

What's going on then in our view is merely a delaying tactic. We have noted a sense of urgency and even desperation emanating from the West's leadership class. We would have to believe, then, that they are not quite ready to move ahead with the implementation of global governance, or even a one-world currency. This is the reason for the deadly silence about the faltering Chinese economy and the attempts to salvage the euro and re-inflate the American business sector. More time is needed; yet perhaps time is running out. And of course, as we regularly point out, the truth-telling of the Internet is complicating the task tremendously.

The Chicoms have done their people no favors by adopting the Western consumerist model. We cannot see how it ends well, in fact. Sooner or later, China must slip into "recession." What then do a billion Chinese do? Stare at the walls of their expensive condominiums, decorated with tasteful knickknacks as they lose their jobs and they watch the purchasing power of their savings erode. THESE Chinese? We kinda doubt it.


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