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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: russwinter who wrote (49207)	1/9/2006 10:36:07 AM
From: John Vosilla	Respond to of 110194

Seems like a severe case of US consumerism and bubblemania taking hold over there too. Long term over say 25-30 years it is a very good thing but you always have pain near term on any massive misallocation of capital with very low cash flow and ROE.

To: russwinter who wrote (49207)	1/9/2006 12:00:52 PM
From: GST	Respond to of 110194

The Chinese government has worked hard for two years to bring the Shanghai market to heel. And it is not only the housing market that is overheated. China has been growing at roughly 10 percent per year for 25 years -- it is almost impossible to imagine what that is like. And they have done it while building up huge savings at the personal and national level and while building a remarkable national infrastructure. They wanted the Shanghai market to stop dead in its tracks and pull back. It took over a year longer than expected, but they did it. As for whether it threatens their economy, the real threat was the bubble like growth and they have now successfully addressed that concern. The balance sheet of the average Chinese is something to admire. The Shanghai property market will hurt some people, but popping it is essential to the health and sustainability of their economy.