Last month, Chi­na hit anoth­er major mile­stone. It passed Japan and became the sec­ond largest econ­o­my in the world, leav­ing only the US in its way. Give Chi­na a decade, maybe a lit­tle more, and it will inevitably surge into the lead. That’s the accept­ed nar­ra­tive.

But then we come across this: the pos­si­bil­i­ty that a mount­ing real estate bub­ble might derail Chi­na’s plans. This report from Aus­tralian pub­lic tele­vi­sion gives you a dis­turb­ing look at how the Chi­nese gov­ern­ment has pumped vast amounts of cap­i­tal into fixed assets, like com­mer­cial and res­i­den­tial real estate, to keep the coun­try’s econ­o­my grow­ing. And what they’re left with is what James Chanos (a hedge fund man­ag­er) has famous­ly described as “Dubai times one thou­sand.” Right now, there are an esti­mat­ed 64 mil­lion emp­ty apart­ments in Chi­na, and approx­i­mate­ly 30 bil­lion square feet of com­mer­cial real estate under con­struc­tion — equiv­a­lent to a five-by-five foot office cubi­cle for every man, woman and child in Chi­na. It’s one thing to read these facts, anoth­er thing to see what it all looks like. And that’s the oppor­tu­ni­ty you get above.

For a more pre­cise roadmap of what a Chi­nese crash might look like, you should spend some time with this piece in Cana­di­an Busi­ness mag­a­zine.

The economic/financial pic­ture is look­ing ugly once again. Indeed, just yes­ter­day, the most emailed New York Times arti­cle warned that the stock mar­ket might be on the verge of an epic crash, one that will bring the Dow below 1,000. So how did we wind up in this glob­al cred­it mess? We’ve heard var­i­ous expla­na­tions, most assum­ing that our cap­i­tal­ist sys­tem did­n’t quite func­tion as it should, and that a few reg­u­la­tions will take care of the prob­lem. But this is not the posi­tion tak­en by David Har­vey, an impor­tant social the­o­rist and geo­g­ra­ph­er (now at CUNY). Draw­ing on Marx­i­an analy­sis (it’s still alive and well some­where), Har­vey sug­gests that the cri­sis is built into cap­i­tal­ism itself. It’s not the result of too few reg­u­la­tions. Rather it’s part of cap­i­tal­is­m’s inter­nal log­ic. (Mark Man­call, an emer­i­tus Stan­ford his­to­ry prof, echoes some of these basic thoughts on “Enti­tled Opin­ions” by the way.) The ani­mat­ed video above is an out­take from a longer lec­ture pre­sent­ed by Har­vey at the Roy­al Soci­ety for the Encour­age­ment of Arts, Man­u­fac­tures and Com­merce in the UK. You can watch the video in full here. Mean­while, David Har­vey has also made avail­able online a free, 26 hour course that offers a close read­ing of Karl Marx’s Cap­i­tal. It appears in the Eco­nom­ics sec­tion of our col­lec­tion of Free Online Cours­es.