The South China Mall, White Elephants & Beijing University.......

I have blogged about this mall in April 2007 and even i´m surprised that things have indeed deteriorated further....

Ich habe bereits im April 2007 über besagtes Einkaufszentrum gebloggt und es sieht so aus als wenn sich die Lage seit Eröffnung nicht gerade verbessert hat....



Most "comical " aspect is that, according to Paul Allen from Bloomberg News, the new owner of this "white elephant" is now the Beijing University .... ?!?!? Surprising that even the Bloomberg reporter shrugs this probably most interesting circumstance of.....

Die Frage muß erlaubt sein warum ausgerechnet die Universität in Peking jetzt Eigentümer ( lt. Paul Allen von Bloomberg News ) geworden ist..... ?!?!? Mindestens genauso überraschend ist, wie fast selbstverständlich der Bloomberg Reporter die wohl mit Abstand interessanteste Tatsache erwähnt, das Universitäten zumindest zum Teil massiv in Immobilien "machen".......

It seems the spin regarding the housing market ( see China "Bubble" ( Bursting ) Update & Newest Spin "Excluding Tier 1 Cities Everything Is Fine......" ) cannot be asserted when it comes to malls.... ;-)

Es sieht damit ganz so aus als wenn die fast verzweifelt klingende Aussage das Abseits der großen Metropolen der Wohnimmobilienmarkt noch "günstig" ist ( siehe China "Bubble" ( Bursting ) Update & Newest Spin "Excluding Tier 1 Cities Everything Is Fine......" ) für Einkausfzentren nicht behauptet werden kann...;-)

But one has to admit that th South China Mall is somewhat "special" and won´t win any awards for their "superb" market research....

Man muß fairerweise zugestehen das die South China Mall wohl keine Preise für besonders gute Marktforschung und Planung gewinnen wird.....

Over the last few years, hundreds of malls have popped up around China, which now claims seven of the world's 20 largest. Two of those, Oriental Plaza in Foshan and Grandview Mall in Guangzhou, are within 50 miles of South China Mall.

It will be fun to see if the ghost town par excellence ORDOS ( see Central Planning & Ghost Towns In China..... & Ordos, China: A Modern Ghost Town ) will face a similar destiny....

Es wird interessant zu sehen sein wie sich die Geisterstadt schlechthin ORDOS ( siehe Central Planning & Ghost Towns In China..... & Ordos, China: A Modern Ghost Town ) in den nächsten Jahren entwickelt.....

China - The people's republic in the grip of popular capitalism / Economist

scary stuff. if this is not a bubble......... if you want more examples how overheated the economy, investments, valuations etc are please click on the label (skip this/the first story). stunning!

wahnsinn. wenn das keine blase ist..........wer mehr belege haben möchte das einige dinge wie invenstitionen, bewertungen usw überhitzt sind den bitte ich unter den labeln zu suchen (jeweils den ersten/diesen bericht skippen). atemberaubend!


Tens of millions of Chinese are risking their shirts in a stockmarket frenzy. If it goes wrong, things could get nasty

WOULD-BE share punters, keen for a piece of China's booming stockmarket, are queuing to open accounts at a Beijing branch of China Merchants Securities. ..... Bunches of small investors, ranging from students to pensioners, crowd around computer terminals to carry out their trades, keeping an eye on the prices as they flicker across big electronic screens. China's biggest-ever stockmarket boom may be turning into a bubble—and the country's leaders are getting worried.

> why they put in question the bubble is beyond me

>wie man die blase nach diesem bericht noch in frage stellen kann entzieht sich meiner vorstellung....

thanks to michael panzer http://www.financialarmageddon.com/

If the bubble were to pop, it could have a bigger impact on social stability than any previous downturn in the stockmarket's 16-year history. There are now more than 91m accounts held by individuals at brokers or in mutual funds. Estimates for the number of investors vary widely. At the height of the last market boom, in 2001, there were 60m accounts but perhaps fewer than 10m investors. There are certainly many millions more now. New accounts at brokers are being opened at a rate of more than 200,000 a day, touching a high of more than 310,000 on April 24th. The total so far this year is more than 8m, which is around ten times as many as in the whole of 2005, when the market began to emerge from a four-year slump. ......

The Shanghai composite index for yuan and hard-currency shares is now approaching 4,000, a rise of nearly 40% so far this year after a 130% increase in 2006 (see chart).

Some economists fret that share prices are moving far ahead of companies' earnings, to a degree scarily reminiscent of Japan in the late 1980s just before its crash. With the help of new share listings, the combined market value of the Shanghai and Shenzhen exchanges has risen to some 15 trillion yuan ($1.8 trillion), 87% more than at the end of last year and surpassing that of Hong Kong.

The growing involvement of low-income groups such as students and pensioners, who were more cautious during the last bull run, could make a crash more painful. Mr Xing says 20-30% of economics and business students are playing the markets. ....

So many employees are spending their time trading stocks online that some companies have introduced fines to deter them. But many continue surreptitiously trading and sharing tips through e-mails, instant messaging and texts. Mobile-telephone users (that is, almost every adult city-dweller) can subscribe to stockmarket alerts and trade shares simply by pressing buttons on their handsets.

Another big change is the ready availability of mortgageable or pawnable assets with which to raise money to buy shares. Since the late 1990s, the privatisation of urban housing has given many people a stake in rapidly appreciating property. And with consumer-price inflation creeping up to a two-year high of 3.3% at the end of March, real interest rates have been around zero or negative this year. This has encouraged the withdrawal of savings from banks. Hou Ning, a Beijing-based analyst, says that in the countryside unlicensed moneylenders have been helping farmers into the markets with unsecured high-interest loans.

> at least they have not yet all the creative loans/instruments like in the us.......

> immerhin haben die bisher nícht die errungenschaften der kreativen finanzierung wie in den usa......

China's leaders are worried, but unsure what to do to cool the market. A string of interest-rate rises and increases in banks' reserve requirements have had little effect so far. Like their fellow communists in neighbouring Vietnam, where a similar stockmarket bubble has grown, they know that share gains keep the rising middle class contented and help the state's big privatisation programme. But if tens of millions of urban Chinese lose their shirts, they could turn their anger on the party.

Twice this year—on February 27th and April 19th—the markets have wobbled alarmingly amid rumours of tougher measures to control the flow of cash. The latest upset was caused by figures showing the economy growing even faster than expected: in the first quarter of this year, output was up 11.1% on the same period of last year. But the bulls have quickly returned. Outside the China Merchants Securities branch, a group of investors debates the market's prospects. “It's like a casino set up by the Communist Party,” says one. Another says only fools are still investing. But none has any plans to cash out

> looks like the 6th raise of the Bank Reserve Ratio in the past 10 month plus several rate hikes plus other attempts to cool things down have failed poorly. maybe they should combine a hike and the raise of the reserve ratio to gain control and respect.

>sieht ganz so aus als wenn alle versuche der chinesicshen offiziellen in den letzten monaten die lage zu beruhigen jämmerlich versagt haben. evtl. sollte sie es mal mit einem doppelschlag von zinserhöhung und der 7. erhöhung der reserveanfordeungen probieren um zumindest etwas die kontrolle zurückzuerlangen.

update: http://tinyurl.com/2eos8w

Shanghai-traded shares of China Citic Bank Corp. more than doubled on their first day of trading after a $5.4 billion stock sale, the world's biggest this year.

``People don't mind paying a bit of a premium'' if they are comfortable with the growth outlook, Binay Chandgothia, who helps manage $1.6 billion as chief investment officer at Principal Asset Management Company (Asia) Ltd., said today in Hong Kong. ``There's demand for new stocks.''

Many Savers, Few Spenders Leave South China Mall Almost Empty

wow! no wonder china is trying to cool down investment (especially when it is speculative) activity. looks like they can´t control the local governments and lots of speculative building is going on. unfortunately i couldn´t find out who the investors are.

make sure you see the slideshow from the mall! http://tinyurl.com/29fo7j

wow! kein wunder das china händeringend versucht die investitionstätigkiet (besonders wenn diese dazu noch spekulativ ist) einzudämmen. sieht immer mehr so aus als wenn das wohl auch wegen der lokalfürsten nicht gelingt. leider ist nicht ersichtlich wer die inestoren sind.

ihr solltet euch unbedingt die slideshow der mall ansehen! http://tinyurl.com/29fo7j


April 17 (Bloomberg) -- The world's largest shopping center looks almost deserted on a recent afternoon. While schoolchildren ride the sidewinder and roller coaster, there are few shoppers and fewer tenants at South China Mall in central Dongguan, a city of 6 million north of Hong Kong.

``They did this mall all wrong,'' says Stephen Liu, a Hong Kong businessman visiting clients in Dongguan who came by to see the place for himself. ``They never found out if there were enough people to fill it. All the Chinese in this town are factory workers, they can't afford to shop here.''

That's a problem for more than just the mall's owners. South China Mall stands as a symbol of China's failure to stimulate more spending by its 1.3 billion people and to curb runaway investment in real-estate projects. The results: A record $232.5 billion trade gap with the U.S. and increasing concern about unsustainable growth at home.

``Until Chinese economic growth shifts from exports and building factories and real estate to consumer spending, China's trade surplus will only grow,'' says Nicholas Lardy of the Peterson Institute for International Economics in Washington. ``That will make trade frictions and a protectionist backlash even more likely.''

Artificial River
A walk around the mall's 220 palm-tree-lined acres takes a visitor past an indoor amusement park, replicas of seven cities including Venice, Milan and Amsterdam, an 85-foot model of the Arc de Triomphe and a 1.3-mile artificial river with gondolas for hire. There's retail space for 1,500 stores, only a handful of which are leased.

The mall's developers expected to attract 100,000 visitors a day, the number it would take to keep its vast shopping areas from looking deserted, ...., more than a year after it opened, the mall gets about 10,000 a day, says spokeswoman Joanne Zhu. That leaves its open- air pedestrian streets almost empty. ...

No Shopping
Huang Xiaoyan is treating herself to a burger and fries at McDonald's, but says she won't be spending money on anything else. ``I'm just here to meet friends, not to shop,'' says the 29-year-old.

Typical of many Chinese workers, Huang doesn't spend much of the 1,500 yuan (almost $200) she earns each month doing accounting work for a local factory. She lives in a company dorm, eats in its cafeteria, sends much of her income home to her parents and saves the rest.

Huang's frugality exemplifies the challenge facing Chinese officials as they seek to quicken the pace of consumer spending relative to investment and exports. China's economy now is ``unstable, imbalanced, uncoordinated and unsustainable,'' Premier Wen Jiabao said at a Beijing press conference March 16.

Private consumption in China, the world's most populous nation and the fourth-largest economy, accounts for just 35 percent of gross domestic product, about half the share in the U.S. and ``quite possibly the lowest consumption share of any major economy in modern history,'' according to a report by Morgan Stanley.

>here is another take from UBS that paints a different picture

> hier eine andere sichtweise der UBS

Before the national accounts were overhauled in 2005, China's GDP failed to reflect many unreported services. The recast figures showed a bigger share of services in the economy, but a smaller share of consumption.

Consumption figures also exclude spending on residential housing. This has surged since the late 1990s, when China's communists first allowed households to buy their homes. Mr Anderson adds investment in homes to the consumption tally, along with much of the extra spending on services discovered in the 2005 GDP revision. He finds consumption's share of the economy today is no lower than its average of the past two decades

Eroded Security
The Chinese save about half their income. Job-cutting at state-owned companies, which once provided lifetime employment and benefits, has eroded income security. An inadequate social safety net requires Chinese to save for retirement, health care and their children's education.
``I'm getting old and I need to save for security,'' says Huang. ``There are not a lot of places to shop here, anyway. It's mostly a place for kids to play.''

Chinese reluctance to spend and eagerness to save is the mirror image of attitudes in the U.S. While China's savings rate is the highest of all major economies, the U.S. rate is negative. Until spending and savings patterns in China and the U.S. change, trade imbalances will grow worse, officials say. ...

Hundreds of Malls
Over the last few years, hundreds of malls have popped up around China, which now claims seven of the world's 20 largest. Two of those, Oriental Plaza in Foshan and Grandview Mall in Guangzhou, are within 50 miles of South China Mall.

South China Mall's 9.6 million square feet makes it more than twice the size of the biggest U.S. shopping center, Mall of America in Bloomington, Minnesota.

``It's Disneyland and Las Vegas come to China,'' says Thomas, chairman of Thomas Consultants. After his firm signed on in 2004 to assist with the mall's marketing, he realized that even this manufacturing hub, one of China's richest cities, couldn't support such a retailing behemoth.

``They rushed to build and open it,'' says Thomas. ``They honestly thought that by building it, they would come.'' ....

Away from the few stores and restaurants near the entrance, the mall's three levels of retail space are a ghost town. Aluminum shutters cover most storefronts, which appear never to have been occupied. A few, now padlocked, show signs of former tenants, with dusty cardboard boxes inside full of unsold athletic equipment, t-shirts, handbags and shoes.

An Imax cinema, meant to be a key attraction, never opened, though posters still hail a grand opening. ....

Hopes to Save
``I only spend money on food and clothes at the supermarket,'' Li says. When she begins to earn more, she says, she hopes to save some and send the rest home to her parents.

The one store with customers spending money is a SPAR hypermarket, part of Amsterdam-based SPAR International, that sells groceries and inexpensive clothing and housewares. The store, opened in November, appears to account for the majority of actual shoppers at the mall. Most load up with groceries and leave, never venturing further to take in the sights of Paris, Milan or Hollywood.

The shoppers South China Mall needs to win over are people like Li Yugun, a fashionably dressed woman munching on French fries and chatting with a friend at McDonald's. A saleswoman for an agricultural firm, she earns as much as 8,000 yuan a month (about $1,035), making her part of China's small middle class. And she has a very American attitude toward shopping.

``I spend everything I make,'' she says, laughing. ``No amount is too much.''

Yet even she doesn't shop at South China Mall: ``The stuff here is too expensive.''

> 10 years down the road the credit card industry may have changed this view........

> in 10 jahren hat die kreditkartenindustrie diese sichtweise dann wohl geändert.....