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by gmays·12y ago·view on hn ↗
If you look into China's real estate market they've invested billions to build cities...empty cities. They continue to build because citizens' investment options are limited, so real estate is one of the few "attractive" options. So they end up with ghost cities full of unoccupied office buildings, condos, malls, etc. Crazy, right?

And now they have bitcoin to put their money into. That's a large part of what's driving the boom. And you know what? It'll keep going. If they're willing to invest billions in ghost cities they're willing to drive bitcoin above $10,000.

I'm not bold enough to claim that bitcoin is a bad investment, but to me it seems closer to gambling than investment. As long as it's money you're not afraid to lose, go for it. But for me there are too many uncertainties and I'm not willing to invest the time. There are so many other opportunities.

Edit: Here's some info on the ghost cities http://www.forbes.com/sites/kenrapoza/2013/09/24/what-invest...

5 comments
Imagine a country where 1 million extra housing units only represented 1/1300th of the housing needs for the nation. Imagine someone having built 625 extra apartments in SF.

China is trying to urbanize 300 million people, a ghost city here or there is a drop in the bucket.

And you know what? It'll keep going. If they're willing to invest billions in ghost cities they're willing to drive bitcoin above $10,000.

I think that is an unfounded conclusion. The ghost city phenomenon is a lot more than just "no other investment vehicles." The process of building ghost cities is ripe with corruption, everybody in the chain gets a cut of what is ultimately land-confiscation and government funded construction loans.

Straight out bitcoin speculation isn't even in the same league of opportunities for corruption.

Some of those ghost cities claims are false. Some claims of 'ghost-city' are using obsolete photos(, e.g. the Florentia Village in Wuqing, Tianjin was falsely labeled ghost shopping malls in an io9.com article where you can hardly find a parking lot available on holidays).

Those cities are getting more and more popular because more people migrated from rural areas to these new urban areas, the amount of migration is huge.

There was a news magazine article from the early 90s on how China was building highways yet no one had cars (besides the military and government). Every project starts empty, it's the next 25-50 years that count.
If Chinese people are using bitcoin to bypass government controls, how long before the Chinese government cracks down on it?