China's looming debt disaster

With the United States and Europe buried in debt, much of the world is hoping that China will provide the engine to bail the world out. However, thanks to China's "hidden debts," China may be far worse off than either America or Europe. When the global downturn hit in 2008, China decided to spend its way out of the crisis, and pumped $1.1 trillion into its $4.3 trillion economy. One result is the building of 65 million apartments -- enough housing for 200 million people -- all empty. Despite the obvious oversupply, the government—in conjunction with private developers—is constructing 40 to 50 million more units. And the Chinese government recently announced it will be building 20 new cities a year over the next two decades, to match the numerous ghost cities already built.