The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: fatty who wrote (30679)	5/4/2005 3:46:53 PM
From: Elroy Jetson	Read Replies (1) of 306849

China does have savings, such as dollars, to live on. But it appears that portion of their savings have been invested in infrastructure which is not likely to return as much value as they cost. Once the banks mark down the loans to value, it will be obvious (at least internally) how much capital has been destroyed. More troubling are growing revelations that many Chinese factories are not profitable but merely busy. It remains to be seen what portion of the commotion inside China is actually economic growth and what portion is merely a gift of under-priced goods to the world. The end of the story is almost always less dazzling than the initial euphoria. The Chinese for their part may not care if their actual state policy is to simply import jobs, knowing that most factories in the US and other nations are unlikely to re-open, even when the Chines raise the price. Classic Game Theory. .

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