A new report from a Chinese government agency finds that the country has wasted $6.8 trillion invested in “ghost cities,” abandoned apartment buildings and highways to nowhere.
In fact many eminent international investors and analysts are warning that China is going to be the ultimate and largest trigger for the next global financial crisis, “a crisis that will be deeper and last longer than the first one that governments quickly combated with unprecedented quantitative easing and bailouts”.
George Soros has warned that China’s subprime lending is starting to look like the U.S. just before its crisis. Leland Miller, President of China Beige Book International, is also warning that the the time ahead will be one of defaults for China.
China’s subprime lending has mushroomed to more than $2 trillion in the last five years. Its corporate bond market now totals $4.2 trillion. Its total credit has surged from $9 trillion to $23 trillion since late 2008, or 250% of GDP. Once again, additional borrowing and spending adds very little to GDP
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