Bubbles are good speculations. They are terrible long-term investments. If you sold your DotCom shares by March 2000, you did well. If you still own those shares, you are reading this article from Poor House. If you cash out of PRC before Bubble bursts, you can watch PRC economic failure from a safe haven. If you ride it to end, you could find yourself little better off than many people in North Korea today.

Bubbles develop because there is a gulf between investor expectation and reality. As more investor lemmings jump into investment, gulf grows. Business decisions are made on perception. In time, perception gulf is recognized and bubble bursts. Currently, American Media is questioning perception gulf in U.S. Real Estate. In due course, American Real Estate Bubble will burst. Eventually, economic reality will overtake Chinese Economic illusion. You don't want to be invested or living in PRC when this happens.

The People's Republic of China (PRC) phenomenal economic growth of past decade came as a byproduct of an unlikely marriage between Capitalism and Maoist Communism. China's economy is based upon an "Export to West" strategy. However, both European Union and United States are objecting to tactics used to create a massive favorable PRC trade balance. This trade-based conflict of interest can only get worse over next few years. As it grows worse, PRC favorable trade balance will contract. In turn, this contraction will slowly reverse PRC's economic growth curve.

Wedding Capitalism to Communism is dangerous. The expectation of Communism is that wealth created by Capitalism will be equally distributed to masses. The expectation of Capitalism is those who make money will keep money. The Beijing Government cannot distribute sufficient wealth to countryside. The Government risks rebellion. Distributing Capitalist wealth evenly in any country offers little financial benefit to majority of citizens in that country. This share wealth axiom applies equally to United States as it does to UK or PRC. So, peasants will eventually conclude that Beijing has failed in keeping promise of Communism. The peasants won't have two cars in every garage and a chicken in every pot. The reason is there aren't enough cars or chickens to meet peasants' expectations.