Thursday, March 17, 2011

Did another Canary stop singing?

Here is another major story that might otherwise be getting more attention except for the other obviously major stories going on.  This one may wind up being the largest of the bunch.
A lot of the calculations related to world resources depletion is based on the presumption that the developing worlds recent demand surges are related to real economic growth.  If this is just another financial-push bubble, you are looking a huge crash.  This would be the type of crash that would have our current collapse finally dethrone the Great Depression as the Grand Daddy of them all. 
It is important to recall that China today fills a role very close to what the United States did in the 1920s.  The protectionist, booming industrial country, that was also a huge lender to the world.  In fact lending to the world so that they could by the expanding industrial surplus is what the U.S. specialized in.
Residential sales in Beijing for January-February fall 21.2%
BEIJING (Caixin Online) — Sales of residential housing in Beijing and Shanghai dropped sharply in the past two months due to both the central and local government’s latest measures to cool the property market.
During the first two months, total housing sales including both residential housing and commercial housing projects in Beijing and Shanghai dropped 18.9% and 26.7% from last year, respectively.
In the past two months, newly launched housing projects in Beijing totaled 2 million square meters, a 34.8% decrease from the same period last year. But residential housing construction increased 14.4% year-on-year to 1.8 million square meters. Chen Lu, China’s cities see slump in residential housingCaixin Online, March 17, 2011.

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