Wealth Management Products in China are a Ponzi Scheme

I have a whole chapter in the book, "The Death of Money", just on China. You know, the wealth management products are a Ponzi and that's not from me, the Chairman of the Bank of China said they're a Ponzi, so you've seen the Chinese banking officials saying the same thing.

The problem is the money's going into real estate so if you're a state-owned enterprise, and you produce steel or glass or any of the cement or any of the components for construction and you just wanna roll steel and build buildings�

I've been out there, I expect you have too, I've seen the ghost cities, I've seen them as far as the eye can see -- completely empty.

And people say, "Well, they'll fill up in the years ahead." No, they won't. I mean, that migration from the countryside to the cities is largely over, number one. Number two, it doesn't take into account obsolescence. You can't mothball a building; you have to occupy it and maintain it.

So, this is wasted investment. If you adjust the Chinese GDP for the amount that's wasted, it would already be lower...

- Source, James Rickards via FXStreet

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