China factor...

China had double digit growth last quarter. With large demand for raw materials - commodity prices have already shooting up. This includes Aluminum, Coking coal, iron ore... Many are saying it is panic buying. China has $2.4 trillion foreign reserves due to currency peg. Earlier this month, China increased the level of reserves banks were required to set aside, curbing their lending ability. Asian stock markets and commodity prices fell on the surprise move, which sellers feared could slow the country’s growth and its buying of raw materials. The shares of UK mining groups also tumbled...

I wonder....not so much as the tightening of banks or whether it is a panic issue. I wonder on how do we know that all this massive infrastructure spending on rails, power grids, highways, are going to pay off. On one side I am biased to view -- there cannot be anything wrong with building infrastructure... but on the other side... I pause for a moment.

Infrastructure is a platform on which other things in life run. It is where people and companies come and go. It can be market place where people enter and exit. It is a ncessary component for a society to function. The better it is the better adavantage we can take of it. But think for a moment -- if there is big gatekeeper who monitors everything that is entering and exiting this platform. There are rules that discrimintate against foreign and domestic -- against freedom and lack of it. What happens? Less use. People shy away. And the platform withers and tatters.

With recent issue with Google and the continuous sketchy treatment of many companies in China I wonder if the infrastructure will be under used or in worst case.... crumble. That's a real possiblity ... I hope doesn't happen.