China's Ghost Cities

#Money

Sat, Apr 23rd, 2011 22:00 by capnasty NEWS

According to this documentary from Australia's SBS Dateline, China's Gross Domestic Product (GDP) is growing at an impressive rate to the point where it surpassed even the United States.

So, what's the problem? The problem is the difference between quantity versus quality GDP. China is a command economy, where the Chinese government can dictate how resources are spent. In order to meet their government's GDP targets, local governance build and build cities. While this is the easiest way to grow a country's GDP, it is not a stable, long-term form of GDP. The fact that these complexes are selling at prices nobody in China can afford and have been sitting empty for years, means that sooner or later, a complete economic collapse -- and maybe unrest -- will be the result.

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