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by kristofferR 2745 days ago
China builds useless buildings/cities because it raises the GDP and because it's often the only viable way to raise funds for local governments. The Chinese people invest in useless buildings because it is often the only viable way to invest your savings.

Some of the useless buildings built for buildings sake will potentially be filled as people move from rural areas, but a lot won't.

https://www.youtube.com/watch?v=f5SE47Xjx2Q
1 comments
api 2745 days ago
The American equivalent is useless military hardware, including sometimes hardware the Pentagon says it doesn't even need.

Both approaches are wasteful but which is more so is debatable. Our military Keynesianism throws off R&D dividends that apply to civilian use cases, but people could live in those cities.

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kristofferR 2745 days ago
A lot of the empty cities/buildings/apartments are way overpriced due to speculation, so the people who want to live in them can't because they're way too expensive and the people who afford to live in them don't want to. That won't change unless housing prices crash, which would be devastating to a lot of ordinary Chinese who have their savings invested in the housing market.

More people are buying their second and third home than are buying their first.

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seanmcdirmid 2745 days ago
A lot of those empty cities (well, districts actually) don't have jobs anyways, so no one actually wants to live in them. In fact, the only reliable way the Chinese government has in getting people to live in them is to move government offices to the area (so civil servants have to live there at least), and then there are problems as the speculators have already come in. This is kind of what the government is trying to avoid in Xiong'an by disallowing speculators (good luck with that).

At this point, there is no way for the housing market to crash gracefully. Maybe in 2011, but not in 2018. The amount of leverage offered up by Chinese banks this time means that most speculators can't simply wait out a downturn.

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api 2745 days ago
We have some of that problem too. The use of housing as a financial instrument is a plague from the pit of hell.
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tabtab 2743 days ago
I'm sure most militaries of the world have similar pork.
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