Speculation, Investment Scandals, Fraud, and China's Hard Landing; Miracle of Chinese High-Speed Rail will be Reduced to Dust; Peak Oil Doomsday Clock
Courtesy of Mish
China has spent $750 billion on rail lines, much of it wasted.
The culprit is not design, but rather shoddy construction accompanied by fraud, greed, and unrealistic growth targets. If that sounds familiar, it's because it was one of the factors in the US housing bust, and indeed every huge bust in general.
Here are a couple of links on the high-speed rail lines I got from Michael Pettis at China Financial Markets.
‘Judgment day' fears for high-speed rail tracks
South China Morning reports Judgment day' fears for high-speed rail tracks
Construction of the mainland's massive high-speed rail network is in danger of becoming a victim of its own success.
The breakneck speed at which track is being laid means engineers are likely to have to sacrifice quality for quantity on the lines' foundations which could ultimately halve their lifespan.
The problem lies in the use of high-quality fly ash, a fine powder chemically identical to volcanic ash, collected from the chimneys of coal-fired power plants. When mixed with cement and gravel, it can give the tracks' concrete base a lifespan of 100 years.
According to a study by the First Survey and Design Institute of China Railways in 2008, coal-fired power plants on the mainland could produce enough high-quality fly ash for the construction of 100 kilometres of high-speed railway tracks a year.
But more than 1,500 kilometres of track have been laid annually for the past five years. This year 4,500 kilometres of track will be laid with the completion of the world's longest high-speed railway line, between Beijing and Shanghai. Fly ash required for that 1,318-kilometre line would be more than that produced by all the coal-fired power plants in the world.
Enter low-quality fly ash.
Professor Wang Lan , lead scientist at the Cement and New Building Materials Research Institute under the China Building Materials Academy, said that given poor quality control on the mainland, the use of low-quality fly ash, and other low-grade construction materials, was "almost inevitable" in high-speed railway construction.
And that could have fatal consequences, Wang said. With a
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