Andy Xie explains to the Financial Times how the Chinese government is well aware of China’s current bubble, and are in fact nurturing it. Maybe because they don’t really have any other choice — Andy Xie likens it to riding a tiger, if you get off it could kill you.
- When the U.S. dollar bottoms, it will cause money to flow substantially out of China. This is when the correction will come.
- But… it is probably a couple of years away.
- China is careful not to prick their bubble, in fact their aim is to prolong it.
- The government does think the yuan should be higher against the dollar, but if they adjust it up too quickly, it could collapse the property market since hot money would flow out afterwards.
Starting at 1:00: (Via Investment Postcards)
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