Dubiously Free Trade, Game Theory, Housing, Trust

China’s Ghost Cities and the Asian Real Estate Bubble

After meandering throughTom Woods’ blog I saw this 60 Minutes video he posted about the Chinese ghost cities. This isn’t like the North Korean city of Kijŏng-dong, which was built by Kim Il-Sung with no intention of every being inhabitated, this what appears to be the beginning (or more likely, the end) of a massive government-subsidized real estate bubble in China. A year or two ago I linked to an article in the Daily Mail with satellite pictures of China’s ghost cities, but it’s gotten a lot worse. Now you have massive swaths of apartments and commercial buildings that the new, burgeoning Chinese middle class is investing in them, but can not afford to actually live in them (and who would want to given that no one else is there). I highly recommend watching this video and pondering what will happen we have the Asian remake of the western real estate collapse:

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Photo Credit: BusinessInsider.com

 

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