Tuesday, September 22, 2015
MICKEYMAN VISITS A "CHINESE GHOST CITY": you won't believe what happened next!
World Complex - Zhengdong New District: is it a ghost city? Here's what you need to know! Far as I'm concerned, if smarmy self-important honkies are still blathering on about "ghost cities" then they don't live in China: both Mickeyman and Billy Bishop have been calling bullshit on that idea for years now.
Far as I'm concerned, anyone with a clue already knows that a big headwind for emerging market development is capital investment: a central planner is wise to look ahead five years and build the needed structural capital well ahead of time, or else his country turns into India, where lack of physical capital will forever doom the nation to low productivity.
Not centrally planning makes it even worse: your cities turn into a chaotic slums.
Even if there's some excess build that turns out ten years from now to have been a waste, it will probably still cost less than the future opportunity cost incurred by not building enough today. Mainly because the future value of present build is, in a growth environment, always going to be exceedingly higher than PV.
But Whitey doesn't know that because he's still got his head up the ass of the classical economists.