I see a pattern here. By the time that Kentucky business leaders visit an international country to “grow business links” for our state, the visited country is doomed.
Could we not find a way to use the resources and brain power to relocalize our state and to disengage from the global economy?
Our jealousy over another nation’s supposed economic miracle is misplaced. Chances are, those “miracles” are nothing more than some debt fueled property development binge.
Three cases in point: Ireland, Dubai, and China.
In 2007, Kentucky business leaders visited Ireland and came back glowing about how great the Irish economy was, and how much we could learn from them blah blah blah. And then as you know, the whole Irish Tiger thing turned out to be a massive ponzi scheme that will take decades to recover from. Read what I’ve said about that trip Gullibility as Economic Development
Then in 2010, many of that same set of “delegates” (sounds better than”junket takers”) visited Dubai. Here’s one great quote about the importance of Dubai to Kentucky: “It’s really a portal by which people do business in the Middle East. It’s a business-friendly center for that whole part of the world, especially for financial firms and trading firms.”
Yeah, it’s all that, or it’s a giant ponzi scheme.
THE DUBAI WASTELAND: 40% of Buildings Are Vacant And Prices Keep Falling
For comparison only 28 percent of homes are vacant in America’s ghost town, Detroit.
Now here’s the scary part. Dubai hasn’t stopped building:
As many as 48,000 homes will be completed in the next two years, increasing current supply by 12 percent, Landmark Advisory estimates.
Around 12 million sq ft of commercial space probably will be completed in Dubai this year, according to Jones Lang LaSalle Inc.
Real estate values have already fallen by over 60 percent since the Dubai crisis, according to Arabian Business. New properties coming online are expected to push prices down by another 10-15 percent, in a slump lasting another 18 months.
Last year Dubai office space was the fourth most expensive in the world, at $1,214 per square foot per year, according to Cushman & Wakefield. This year the emirate has fallen off the list, with declines of more than 30 percent.
And dont worry – our business leaders are off again for their second trip to China in a year. What will they find in China? It will “open your eyes to the vast business opportunities this country of 1.3 billion has to offer…”
China’s bubble will burst – and take Asia with it, says Jim Chanos
By James McKeigue Money Week Feb 17, 2011
“China is heading for a fall”, says Jim Chanos – and it “will take Asia and resource economies like Australia and Brazil with it”.
Chanos, who has used satellite images from Google Earth to highlight Chinese “ghost cities”, has been criticized by some fund managers for never visiting China. But he thinks “being on the ground is overrated. In fact, people in China get bamboozled the other way. They see lots of activity and think things are booming… But if that isn’t economic activity, you’re going to have a problem, no matter how good it looks. People should spend more time studying the numbers.”
Read the rest here
I think if I’m a foreign country, and I hear that a group from Kentucky is visiting, I duck and fucking cover. The party is over.