China has been in a slump since 2008

Don't believe me? Just look at the chart below. This is Shanghai Composite index. Ever since 2008, it has never been able to climb back to its former glory. In fact it has been spending years on bottom formation.

 

So where did all these rumours come from? We see many Chinese tourists coming to our countries spending loads of money like they are worthless piece of paper. I ever witness on a plane that a few Chinese tourists was looking at the duty free catalogue and decided on the spot to buy a few thousand dollars watch.

 

While it may seem that Chinese are everywhere, we must understand that these are but less than 1% of the population, there are still a 99% of the population not making it.

 

A colleague of mine for instance stayed in Shen Zhen. While he works as a Sales Manager in the company, he cannot afford to buy a house of his own. The price is at such rediculous level that no one with a working salary can afford. This is only in Shen Zhen area, which is one of the 2 most expensive cosmopolitan in China, the other is Shanghai.

 

If you go further into remote part of China, you will see even worst situation. I went to Guang Zhou about 2 or 3 times. On the surface it is filled with richness, skyscrappers and nightlives (minimum spending in a Karaoke is RMB 2000/-, I checked). Yet behind all these building in the back lanes, you can immediately find poverty.

 

Many are still not doing well in China. It is only the Government's effort to show case a country climbing up to international level that makes it look rich. Theyc continue to invest and build buildings and cities to put in more firewood for burning. If you check on youtube.com, you will even find an article about Chian Ghost city.

 

This reminds me of its similarity with Japan. Japan at one point was trying to fund the economy by initiating endless numbers of project. such as building a bridge that go no where. China is doing the same now.