From the article: "The current run-up in the price of Bitcoin is an indicator of the interest in the currency, but is likely largely due to speculation." Report

From the article: "The current run-up in the price of Bitcoin is an indicator of the interest in the currency, but is likely largely due to speculation." Reporting by economically literate journalists familiar with the situation in China points out that China's housing market is a bubble.[1][2] The speculation in the current residential housing market in China is because middle-class investors cannot find a better investment vehicle, and because they are making unrealistic assumptions about future demand. What's unrealistic about the demand is that migrant workers moving legally to Chinese cities (as they already move illegally) will not possibly be able to afford current market prices for new housing units in China. There is a huge oversupply of housing that is too expensive for anyone to buy who is in the market for a place to live (as contrasted with being in the market for a speculative investment vehicle). The bubble will have to pop. When the China housing bubble pops, China's whole national economy will be severely stressed, and political instability may erupt. The ability to buy houses with Bitcoin reported in this thread is just one more sign of a bubble housing market in China. [1] http://finance.yahoo.com/news/uncomfortable-truth-chinas-property-market-084546007.html http://finance.yahoo.com/news/uncomfortable-truth-chinas-pro... [2] http://www.forbes.com/sites/realspin/2013/10/28/in-china-theres-not-one-city-sans-terrifying-stretches-of-empty-houses/ http://www.forbes.com/sites/realspin/2013/10/28/in-china-the...