China's Real Estate Market Dilemma (Portfolio)

Stratfor's Vice President of International Projects Jennifer Richmond discusses a recent record land auction in Beijing and explains how China's changing real estate market impacts the country's economy.

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[ClarksonsinUSA]

You are correct..

It is impossible to sell anything to people making $1 to $3 a day...Its the sad truth...

[MegaLucifer]

I didn't attack anyone. I gave a counter argument to anyone I felt was bias in their views upon China such as yourself. China is building everyone day by day. New airports, roads, subways, buildings, skyscrapers and accomplishing new engineering feats. This is a golden time for China and you need to accept that. Some projects are overkill such as the ghost cities but they are being propped up for future relocations. They are thinking really long term now. I think you are too caught up...cont

[redwhitedude]

People not having bank accounts shows that there is still a lot of people that don't earn enough to even save the money to put in banks. US people have accounts but they spend beyond their means. This is a sign of the weakness of chinese financial market. Not enough domestic savings people don't earn enough. Any "savings" is probably coming from the trade surplus especially from the US, this tends to be corporation earning it not people.

[qazwas]

This is madness. Commodities markets need and end users, otherwise there is no market. Imagine gas stations buying fuel from suppliers at such a rate that they need huge tanks to store it and the going rate to the consumer is $1000 a gallon, meanwhile there is no consumer demand due to the price, who are all riding bicycles to their jobs at the refineries where they work overtime...

[redwhitedude]

Yet that means nothing to improving Japan's financial situation. You can't dump all that without causing a major tidal wave in the financial markets. The recession and boom times cycle seems to be relatively unaffected by it. Japan can't afford to pull the plug on the US which is a very important market for Japan.

[ClarksonsinUSA]

My company owns a factory in Jenming many of my co workers that have been there said the big cities in the east that most relatively new housing blocs lay empty....I can only tell you, what they said....

[redwhitedude]

The high speed train project which had an accident. That's one when you look at it.

[MegaLucifer]

I'm not talking about what you said about economics but in terms of demographics. China may have an aging population but there are exemptions to the one-child policy and they can always eliminate the one child policy if that was the case of a large senoir demographic. Also the Chinese economy is not going to collapse unless the USA economy does since China controls the largest % of USA debt and makes interest on those loans every second.

[redwhitedude]

Then why the heck were Japan's debt holdings mentioned as a way to show that Japan's financial situation isn't bad? You were suggesting that it could be used to help out Japan.

[MegaLucifer]

When was Japan ever mentioned about dumping the dollar?

[evilmickey]

i think what he means is that the chinese economic might have been overly exaggerated

[webersilk]

So....basically China is facing the same thing the US faced in 2008, regarding the housing bubble.

[romanowskicm]

China is directly undermining oil priced in US dollars, China built their own pipeline to Turkenistan. China is building a oil refinery in Saudia Arabia. Address this as I see it as the most direct threat to the US

[redwhitedude]

As a Japanese engineer puts it China is trying to run before they learn how to walk.

[redwhitedude]

The real estate market is thought to be a bubble. There are apartments that were built that sit empty in fact there are practically empty cities. So why is china building things like skyscrapers like crazy?? Economics should dictate whether to build or not. I suspect there are other reasons to build them.

[evilmickey]

i think wat he means is the economic might of china has been highly over exaggerated

[MegaLucifer]

As long as Walmart, China will make bank and the USA will always be the biggest consumer of cheap goods. China uses the money they make from those goods and lends out that money to the USA to upkeep their military and wars. China earns interest off the loans lent and buys up resources such as oil, copper, iron ore and this cycle continues. USA and China are dependent on one another now. If anything happens to one or the other, shockwaves will be felt across the globe.

[redwhitedude]

The point of Japan is the fact that china owns US debts and lots of it doesn't mean much or is not the leverage that you think it is. It's better to be pro american than pro chinese given the CCP and the way things are done there.

[MegaLucifer]

No I was only stating how much USA debt these nations are holding. Actually nations are already dumping the USA dollar in trades. Many other countries will soon follow. The USA shot itself in the foot.

[meProudToBeCaucasian]

at least china does something america would let it just running until it colapses