I have the same uneasy feeling about China as the SURE THING investment in early 2011 as I did about the garden of eden aura of easy money in the US in early 2007.
According to Lenzner, there is a real risk for a property bubble:
China could suffer a hard landing in 2012 if the property bubble is not taken under control. “Only when property prices drop sharply can we believe that the government is serious about fighting inflation,” says Andy Xie,, a Board Member of Rosetta Stone Advisors. “The level of property prices defines how much local governments can spend. Fighting the property bubble is a must for fighting inflation.”
Consider that China’s plans to build 40% of the world’s skyscrapers in the next 6 years might be considered a “sign of over-expansion and a misallocation of capital,” according to businessinsider.com
Read the entire article here.