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Chinese Infrastructure Spending |
HenryTo
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 Posted: Sat Feb 13, 2010 1:40 pm Post subject: Chinese Infrastructure Spending |
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NY Times' wrapup on China's new high-speed rail network and its target date for completion. Interestingly, a trip from LA to SF takes 1 hr 15 minutes by air, 6 hours by auto, and 11 hours by rail (and the latter isn't consistent as freight trains have the right-of-way):
http://www.nytimes.com/2010/02/13/business/global/13rail.html?em
| Quote: | Officials drafted a plan to move much of the nation’s passenger traffic onto high-speed routes by 2020, freeing existing tracks for more freight. Then the global financial crisis hit in late 2008. Faced with mass layoffs at export factories, China ordered that the new rail system be completed by 2012 instead of 2020, throwing more than $100 billion in stimulus at the projects.
Administrators mobilized armies of laborers — 110,000 just for the 820-mile route from Beijing to Shanghai, which will cut travel time there to five hours, from 12, when it opens next year.
Zhang Shuguang, the deputy chief engineer of China’s railway ministry, said in a speech last September that the government planned 42 lines by 2012, with 5,000 miles of track for passenger trains at 215 miles an hour and 3,000 miles of track for passenger and fast freight trains traveling 155 miles an hour. Top speed on the Tampa-to-Orlando line is supposed to be 168 miles an hour.
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Bullet trains travel faster than a commercial jet at takeoff. They require extremely flat, straight routes. Amtrak’s Acela only briefly reaches its top speed of 150 miles an hour because it runs on old, curvy tracks that it shares with 12,000-ton freight trains.
On a recent Wednesday, the 2:50 p.m. bullet train glided smoothly out of Guangzhou’s station and within four minutes was traveling more than 200 miles an hour. Practically every seat on the 14-car train was full of migrants heading home for Chinese New Year. |
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rffrydr
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| Posted: Sun Nov 13, 2011 8:26 am Post subject: |
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Nice piece...where was it in '08? As indicated by the first comment, we are currently in world where fully 12% of china property stocks are held short and Wanzhou lenders are dropping like flies.
There is of course a one word answer to many of these questions, and it's not mentioned in this article, healthcare. Work and the body are synonymous in this health/sickness obsessed culture. There is a great deal to gain here in terms of domestic spending.
Additionally, the stealth rise in the Yuan, by the general rise in wages combined with the saturation of manufacturing labor in the South East will launch a new chapter in domestic spending capacity a la the old Henry Ford maxim. $1 cotton, $5 wheat will not take that away through inflation either.
Broad comparisons to Japan, S. Korea and Taiwan miss the mark here in the same way "spreads to treasuries" are missing the mark on Wall St. These other "transitions" were never accomplished in the globalized failure of the present-day. Of course the relative balance to GDP is going to favor fixed--favor it by a lot. Facing global depression the world called on china to spend. It did that in spades. The excesses are apparent and the effects on capital, forewarned right here, are reminiscent of the great rail bust here a century ago. Bad for money, good for society--as with the dotbomb era and many more "booms" over the ages.
Steel is interesting, much of that capacity is replacement capacity as china moves up the scale. Indeed, steel is as much an energy policy at this point. But, more broadly, it is also the dirty industry the western world has been all too happy to delegate to china. A central reason why our capacity is so low is exactly the same for why china's is so high.
More broadly, and this became verbalized during the Yangtze dam project, china sees the world it aspires too and sees a world of private property and a sea of spoiled "little emperors." It is making now what it knows it can not "get away with" a generation from now. Infrastructure requires "em(porer)inent domain."
I've been bearish the "china story" all the way through the cycle. Some big misses there, like luxury. And I called this "credit crunch" when it was launched in '09. But I've never really shorted it. --It's just too big a reality.
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HenryTo
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rffrydr
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| Posted: Sun Oct 02, 2011 9:02 am Post subject: |
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With the recent subway deaths on the heels of train crash (coupled with world resentment towards China's pilfering of japan's tech here) rail buildout is done. But TMM spots this ready for an commitment:
http://english.caing.com/englishNews.jsp?id=100253299&time=2011-04-27&cl=111&page=all
Coupled with the electric car policy (self-fulfilling rare-earths monopoly), and fear of global paper, I would not discount it.
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