The heft and feel of a well-worn handle,
The sight of shavings that curl from a blade;
The logs in the wood pile, the sentiment of huge beams in an old-fashioned house;
The smell of fresh cut timber and the pungent fragrance of burning leaves;
The crackle of kindling and the hiss of burning logs.
Abundant to all the needs of man, how poor the world would be
Without wood.

Everard Hinrichs, quoted by Eric Sloane in A Reverence for Wood

Translate

Thursday, March 1, 2012

An update on the Chinese housing market

I promised to update you periodically on the Chinese "ghost cities", as we struggle to understand how they have impacted our wood industry in the last few years and how they might impact it in the near future.

It doesn't look too good right now. I may have said this before, but their impending housing bubble implosion may make ours look like a hiccup. Here's a video with the latest news, given from a Chinese perspective. The audio is in Chinese, but you can follow the English sub-titles pretty easily.



The end of the video revealed a slightly different twist on their situation. Some seem to be predicting that the implosion will be good for the economy, in the sense that a "real" market will develop for housing as the prices fall closer to what more people can afford. This in effect, they seem to think, will help transfer much of the country's wealth from the rich people and the government (which in China, is pretty much the same thing) to more of the poor, in effect creating a middle class.

So it could be a short-term economic shock, followed by a longer-term slowly rebuilding economy.

Let's hope it works itself out peacefully, without a ripple effect into the rest of the world's economies.

No comments: