The Chinese Death Star

US Companies Fret Over China's Economy

Marc Faber: Colossal Credit Bubble In China, Unwind 'Will Be a ...

The Chinese have finished the construction of a major tunnel that is part of a mountain transport corridor from Turpan to Kurla that is linked to Pakistan. The corridor is part of the extension of the Karakoram Highway that is part of a project to re-integrate the westernmost portion of the People’s Republic of China with the areas of Eurasia to its west.

Beijing has been setting up its own transportation infrastructure and energy pipelines in Eurasia, and the infrastructure being built will be the engine of an economic renaissance that is unfolding. The Chinese now have a presence all around the old Silk Road and the ancient maritime trade routes in the Indian Ocean that sold spices and precious metals.

China has been busy building deep-sea ports, holding bays, railroads, highways, tunnels, and transportation hubs throughout these regions.

How China Fooled the World - Monday 31 March 2014

China is now the world's second largest economy and for 30 years it has been growing at an astonishing rate.

That growth has given the world cheap goods and the potential to sell the Chinese massive amounts of raw materials.

For countries like Australia, the China boom has been great news.

But there is a problem. In recent times, the boom has been sustained by an explosion in lending by banks and so-called 'shadow banks'.

If the current scale of lending proves to be unsustainable, could that end the boom and result in China becoming the next country to succumb to the impact of unproductive debt?

This week the BBC's award-winning This World unit goes to China to take a long hard look at the boom, what fuelled it and what would happen if that unproductive debt was called in.

The program clearly lays out how the Chinese leadership responded to the prospect of a global financial crisis and possibility of a world-wide depression.

The response focused on a spending and investment program carried out on a scale never seen before in human history.

Over the past five years, a new skyscraper has been built every five days in China - along with 30 new airports and 42,000 kilometres of freeways.

Interviewing key players including former American Treasury Secretary Henry Paulson, former Chairman of the Financial Services Authority Lord Adair Turner and Charlene Chu, a leading Chinese banking analyst, reporter Robert Peston reveals how China's extraordinary spending has left the country with levels of debt that many believe can only result in an economic crash with untold consequences for the world - particularly resource-driven economies like Australia.

http://www.abc.net.au/4corners/stories/2014/03/31/3972864.htm

A virus never before seen in the US has killed millions of baby pigs in less than a year, and with little known about how it spreads or how to stop it, it's threatening pork production and pushing up prices by 10% or more.

Estimates vary, but one economist believes case data indicate more than 6m piglets in 27 states have died since porcine epidemic diarrhea showed up in the US last May. A more conservative estimate from the US Department of Agriculture shows the nation's pig herd has shrunk at least 3% to about 63m pigs since the disease appeared.

Scientists think the virus, which does not infect humans or other animals, came from China, but they don't know how it got into the country. The federal government is looking into how such viruses might spread, while the pork industry, wary of future outbreaks, has committed $1.7m to research the disease.

China is at the point where problems are feeding on themselves.  Pessimism about property, which accounts for about 15% of China’s gross domestic product, is beginning to affect the broader economy.  Declining property values look scary, despite cheery statements from government officials who assure us the property bubble is “not big” or analysts who say that the problems are not “systemic.”  

But the Chinese don’t look like they are buying either of those views.  “If this continues, it will have immense impact on the whole Chinese economy,” says an unidentified Hangzhou real estate salesman on Economic 30 Minutes.  “Without question, everyone thinks there is a bubble.” 

http://www.forbes.com/sites/gordonchang/2014/04/13/china-property-collapse-has-begun/