Driving in any direction from where I am now and you'll see a Chinese economy that continues to grow. New building projects, including infrastructure, commercial and residential, continue to spring up everywhere. In fact, the growth is so strong that the Chinese government is working to help slow it down and help ease concerns over inflation.
Just this week, the Chinese government increased the reserve rate for large banks 0.5% to 18.5%. The increase is the fifth this year and the second this month alone. Increasing the rate reduces the amount of capital in the market that is available for lending, thus (hopefully) reducing the number of future projecs by reducing the amount of money available to fund them. The increase will freeze almost $45 billion USD in liquidity.
The government has also jumped into the residential property market by limiting the ability of a Chinese person to own a second home. This action is intented to help with the steep increases on real estate (due in part to speculation) which some estimate will increase as much as 80% this year alone in some markets.
Throw on top of that a continuing fear of inflation for food and materials and China has some challenges ahead.
While the intra-China growth shows no sign of slowing, the business climate for those supplying goods to the US isn't so rosy. Many of the factories I've been to this week report slow orders for the last quarter and some hint that the US has taken a "double dip" in terms of its slowing recovery.
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