Robert Aliber, a professor emeritus of international economics and finance at the University of Chicago, has made prescient calls on the U.S. housing bubble and credit crisis in recent years.
On Tuesday, he predicted China’s housing boom would soon turn bust in a forecast to the university’s Booth School of Business’ Alumni Club of Colorado at Denver Country Club.
“A very significant part of China’s growth the last three years has been the construction of apartments,” Aliber said.
Apartments in Beijing cost 30 times the average wage, a multiple that outstrips anything seen in this country last decade. Many of those units are sitting empty, waiting for someone to snap them up at a higher price.
When those buyers disappear, China’s economy will slow, triggering a collapse in global commodity prices.
But the U.S. economy is resilient enough to withstand that and keep growing, Aliber said.
Aliber recommended the administration and others not focus on currency levels but on the trade imbalance, which has cost the country 2.5 million jobs.
“Until we solve the trade-deficit issues, we can’t solve the fiscal-deficit issue,” he said.
Aldo Svaldi: 303-954-1410 or asvaldi@denverpost.com
