China Bubble

Though slowly.  For the first time in 16 months, property prices dropped month on month in big cities of China.

http://www.smh.com.au/business/world-business/china-property-prices-drop-for-first-time-in-16-months-20100712-107hp.html

http://news.xinhuanet.com/english2010/video/2010-07/15/c_13400309.htm

http://images.businessweek.com/ss/10/06/0615_global_millionaires/image/china–bcg.jpg

No. 3: China

Population: 1,331.4 million
2009 number of millionaire households: 670,000
Percentage increase: 30.7 percent YOY
Share of country’s wealth held by millionaire households: 50 percent
While developed countries struggled through the recession, China’s economy continued to boom, with gross domestic product growing 8.7 percent last year. The surge of commercial activity has created a growing nouveau riche population in China that includes entrepreneurs and investors, although they still represent a tiny fraction of the total population. Seeing opportunities in the growing wealthy demographic, luxury retailers have set up operations in major cities, and high-end real estate is drawing interest—for example, a $30 million house reportedly sold in Shanghai.

http://images.businessweek.com/ss/10/06/0615_global_millionaires/4.htm

The big picture is that some 2 million people (<0.2% of total population) are controlling 50% if the country’s wealth. Not a pretty picture.

http://in.reuters.com/article/idINIndia-48926020100531

This is what Goldman Sachs estimated a few months back.

http://english.people.com.cn/90001/90778/90860/6899613.html

http://imarketnews.com/node/14798

http://www.businessweek.com/news/2010-06-06/china-housing-prices-to-dip-20-30-in-new-few-quarters-barclays.html

http://www.istockanalyst.com/article/viewiStockNews/articleid/4166616

Even though it is for commercial real estate, and won’t be as sensitive to the turmoil in residential real estate market,  it could still serve as a good reference.

http://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chfdeh=0&chdet=1273906797792&chddm=234209&chls=IntervalBasedLine&q=NYSE:TAO&ntsp=0

http://www.optionszone.com/market-commentary/sector-reviews/2010/02/investing-in-china-why-youd-be-crazy-to-short-china.html