Lost in Anhui
. . . Taxi starts to drive away with all our luggage . . . Frantic banging on the windows . . . Finally get on the boat for Anhui province. After 10 minutes the boat mysteriously turns around and returns to dock. . . Seems a family called and said they wanted to ride along, but were late. Forty minutes more waiting, then an obnoxious family of seven from Guangdong board. It’s 95 (35 C) and ultra humid. No AC. Four hours later arrive in deepest darkest Anhui. Bus takes off without us. After frantic calling it turns around and returns. Now we’re the jerks holding everyone up. Typical zany 3rd world bus ride, then transfer to another bus. Now sitting on luggage. Entire province seems to be a giant construction zone . . . May have to rethink my skepticism of China RE bubble theories. Looks like complete mess, but billboards show plans for “Narnia”, which will be full of elegant mansions in the French, Italianate and English Tudor styles. The pictures sure look pretty.
Now I see why the official figures show poor Anhui growing much faster than China as a whole. It IS growing much faster. Stuck in bumper to bumper traffic in some small nameless Anhui town with tons of tall buildings under construction, I imagine this is what New York and Chicago must have looked like around 1900.
Part 2. M is for Moron
Check my email for the first time in days, and find 100s of messages. My heart drops. Then I delete all the messages from Mike and Major, and find almost nothing left. That’s much better.
Don’t expect much posting until I return to the first world (I.e. Beijing.)
P.S. Had a very enjoyable dinner with Yichuan Wang in Shanghai. Also heard about Evan Soltas’s new gig. Well deserved.
PPS. You can get a filling (but basic) meal in a four star Anhui hotel for about two dollars.
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21. August 2012 at 06:51
Feel free to point us to pictures of those Narnia billboards. Reminds me of this classic Spike Japan post.
http://spikejapan.wordpress.com/2011/01/23/huis-ten-bosch-only-miffy-can-save-us-now/
21. August 2012 at 07:24
From my memories of the East Asian 1990s real-estate boom:
– Concentrated high-rise residential units are in trouble, unless they are fortuitously close to a successful urban core. It’s very hard to do this well, and building and environmental upkeep (dealing with litter/road maintenance/etc.) for such densities required more good government than upper-middle-class neighbourhoods in Malaysia and Indonesia could provide; lower-class neighbourhoods basically became slums. Such things are for megacities, not surburban periphery.
– endless rows of identical two-storey mansions may be okay. The developer will invariably forget that families of human beings need grocery stores, schools, bus stops, and other sundries – but what happens in developing nations is that zoning laws are simply ignored and light industry pops up in the mansions themselves: preschools and such. Likewise spontaneous neighborhood committees to levy their own taxes to maintain the pavement and street-lamps can arise, since the state is too inefficient to chase these away. Even if no industry exists nearby, the developer just sells the entire neighbourhood to a prospective employer who then house their staff in the neighbourhood. As long as it isn’t improbably remote, this tends to work out.
– the really expensive projects, the ones that end up sinking whole banks, will be the mega-infrastructure ones, not the numerous small commercial/residential structures. An explosion of bridge-building means trouble.
21. August 2012 at 07:43
Scott,
What an amazing adventure. You are in the middle of history in the making.
21. August 2012 at 07:56
The most interesting thing in this recent Globe article was buried in the last papragraph:
http://articles.boston.com/2012-08-17/business/33232638_1_inflation-target-core-rate-interest-rates
“Another option, proposed by Harvard University professor and Mitt Romney campaign adviser Greg Mankiw, would be to change from ”rate targeting” to ”level targeting.” Under this approach, the Fed would aim for an average annual inflation rate of 2 percent but commit to higher inflation in a given year to make up for low inflation in the previous year, or lower inflation in a given year to make up for high inflation in the previous year.”
21. August 2012 at 09:40
Then I delete all the messages from Mike and Major
For what it’s worth, I am actually rather glad that you did this. It was one of the worst experiences of “debating” I have ever encountered.
21. August 2012 at 09:46
You people actually email poor Scott too? Or he just gets an email notification of each comment? (In the latter case, apologies for cluttering your inbox with this, Scott)
21. August 2012 at 10:00
Have you gone to Hefei? I interned in Hefei, Anhui two summers ago, and I was under the impression that a lot of the housing that had already been built (luxury) was unoccupied. And now they’re building more?
I forget where the apartments were exactly, but they may have been next to the main tourist park (the one that has a mini-history of each district within the province).
21. August 2012 at 10:18
‘all the messages from Mike and Major’
For a respite from brains on politics, Eric Falkenstein has a new book, priced reasonably, that should interest some here;
http://www.amazon.com/Missing-Risk-Premium-Eric-Falkenstein/dp/1470110970/ref=sr_1_1?s=books&ie=UTF8&qid=1345223074&sr=1-1
‘Risk is the deviation from the consensus rather than an exposure to a covariance, and this implies there is no risk premium in general. It also implies that when there are a large number of people buying highly volatile assets, such assets will have negative returns in equilibrium. As there are several independent motivations for people to buy highly volatile assets, intuitively risky assets generally have lower-than-average returns. This novel conception of risk implies many things more consistent with the data than the current theory. Risk taking is an important life skill, so understanding its nature is important, and unfortunately academics who study it full-time are like so many other experts: when not irrelevant, 180 degrees wrong. This book explains the current asset pricing theory, and proposes an alternative, using theory and a unique survey of the data across many asset classes. Familiarity with some MBA level finance is helpful but not necessary to appreciate this book.’
21. August 2012 at 13:16
Thank our overlords while you are there. The work hard so we don’t have to. Thanks, China.
21. August 2012 at 13:42
I wish LA were going through a high rise construction boom…
21. August 2012 at 18:22
Narnia? LOL.
21. August 2012 at 18:23
What’s there to do in Anhui?
21. August 2012 at 18:57
Do you have any pictures? Might make a cool travelogue.
21. August 2012 at 22:08
I’m glad to hear that you met Yi-chuan Wang! In any case, is there any chance that you will head down to Hong Kong in the future?
22. August 2012 at 02:17
yes, all comments go to my email box. no trip to Hefei, will climb Yellow Mountain tomorrow or die trying.
22. August 2012 at 05:47
“Then I delete all the messages from Mike and Major, and find almost nothing left. That’s much better.”
Touche. It was just an experiment on my part to see what happens if you don’t let Major get the last word. The answer is you get 500 comments.
22. August 2012 at 06:51
Haha, an “experiment”…yeah, that is believable.
You could have just asked. But you didn’t. Why? Because it wasn’t an experiment at all. It is how you operate. You don’t like me getting the last word, so you want to get the last word.
Personally, I don’t want to get the “last” word. I just want to get the “next” word, hoping that you will continue to want to learn, by responding.
Thanks for revealing to everyone your actual motivation of trolling.
22. August 2012 at 07:24
Just ask what? See we could do this again, 500 more posts but I’ll give people a break. You want the last word. Usually people just give up not becasue you’ve won the argument but because they see it as a waste of time.
However I made a point of not letting you have it and the result was 500 posts-after all Sumner wasn’t around and it was a slow news day around here. I’d rather get the empricial answer than your obfuscations. That’s why I didn’t “just ask.”
22. August 2012 at 07:31
Mike – Is it the last word if nobody’s reading him? Don’t feed the troll.
22. August 2012 at 07:35
Just ask what?
Ask whether I would want to try to get the last word 500 times. I would have said “I would like keep debating with you, and if you want to keep responding 500 times, then expect for me to oblige.”
See we could do this again, 500 more posts but I’ll give people a break.
Your choice of course.
You want the last word.
No, I actually don’t want the last word. I said I want the next word.
Usually people just give up not becasue you’ve won the argument but because they see it as a waste of time.
I see you’re not abiding by your own maxim.
However I made a point of not letting you have it
I don’t want it. That’s my point. Since you are the only one making a point of last words, it only tells me and everyone else you want to get the last word, and you are blaming me for it. You’re like a drug addict who blames his dealer.
I’d rather get the empricial answer than your obfuscations.
OK, but I would have offered an empirical answer if you just asked. But we both know your “experiment” story is bogus.
That’s why I didn’t “just ask.”
No, you didn’t ask because it wasn’t an experiment for you. You are fulfilling your own prophecy of worrying over who gets the last word, by yourself becoming such a person who wants it.
Not a single post I have ever sent to you was designed or intended to be any last word. I don’t intend to stop any time soon. It’s up to you if you want to keep going.
22. August 2012 at 07:36
Adam:
Mike – Is it the last word if nobody’s reading him? Don’t feed the troll.
You obviously don’t understand what a troll is, and you’re just name calling solely because I don’t play by your rules and don’t have your beliefs.