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  • China Real-Estate Bubble Concern Fails to Deter Global Investors in Poll

    Published on November 12, 2010

    Most global investors think China is experiencing a real estate bubble, even as they say the world’s fastest-growing major economy offers the best opportunity for making money over the next year.

    Two-thirds of the people surveyed in the latest Bloomberg Global Poll say a bubble is inflating property values in China, where the economy grew at a 9.6 percent annual rate in the third quarter. Still, when asked to identify one or two markets offering the best opportunities in the next year, 33 percent of investors cite China, more than any other country. Brazil ranks second at 31 percent, followed by India with 29 percent and the U.S. at 23 percent.

    The full story is online at: http://www.bloomberg.com/news/2010-11-12/china-real-estate-bubble-concern-fails-to-deter-global-investors-in-poll.html

    Only 10 percent of respondents describe China as cooperative and willing to compromise. Almost nine of 10 say the Asian superpower pursues its own interests, even at the risk of creating tensions with other countries, in the quarterly poll of 1,030 analysts and traders who are Bloomberg subscribers.

    Fifty-nine percent of investors say they’re optimistic that the policies of Chinese President Hu Jintao, 67, will help his country’s investment climate. Among eight world leaders, only German Chancellor Angela Merkel, 56, ranks higher at 61 percent.

    Almost two-thirds of respondents from Asia and Europe are optimistic about the impact of Hu’s policies, compared with 53 percent of investors in the U.S.

    The Bloomberg Global Poll was conducted on Nov. 8 by Selzer & Co., of Des Moines, Iowa, and has a margin of error of plus or minus 3.1 percentage points.

    Asian investors are more likely to say China is in a real estate bubble. Seventy-four percent of respondents in Asia hold that view, compared with 64 percent in the U.S. and 63 percent in Europe.

    China’s State Administration of Foreign Exchange this week announced rules that would force banks to hold more foreign exchange and strengthen auditing of overseas fund-raising as part of its efforts to reduce money inflows that may inflate asset bubbles. The measure underscores concerns outside the U.S. that the Federal Reserve’s expanded monetary stimulus will cause capital to flood into emerging markets.

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