Yes the signs are that the Chinese property market bubble is finally beginning to pop. There is massive over supply of expensive to buy property and it has stopped rising so the speculators are finally taking a hit. With the average property in China in some cities at over 25 times the average wage there is clearly going to be a day of reckoning. LINK1 and LINK2 There will be many property developers going under and some banks will be in big trouble. Sure the Chinese policy makers will intervene but I think the scale of the problem is now so big that a major correction cannot be avoided. Chinese debt has also grown form $10 trillion in 2009 to $24 trillion in 2013 - debt financed propery price booms always end up with a nasty hangover and this one will be nasty take my word on it ! Nice FT video discussing the bumpy road ahead I would add a Very bumpy road ahead with a nasty cliff at the end of the road.

This is an interesting question as doing an MBA is not at all cheap the fees can easily be $60,000 plus at a good School and then there is the lost wages another $60,000 to $80,000 so you are looking at an investment of $120,000 or more. Another factor of course is that US programs are typically two years while European programs are generally one year (full time or two part-time !) so a US MBA might cost you $200,000 +. I have taught the MBA program at Cass and like to teach the MBAs as they are a challenging lot to teach and a demanding lot (no surprise given the fees !) but you can often learn quite a bit teaching them. Personally I think a year on a good program is quite a good investment as you get given a lot of concepts to think about and you can learn so much from the other students who have work experience in many different fields. But I am not convinced you need two years full-time like the American's tend to have. BusinessEconomics.com has a popular page with links to MBA related issues LINK1 and Bloomberg have a nice video below discussing the worth of an MBA degreewith Peter Henry Dean of NYU Stern School of Business.

Yep the largest fine ever levied on a US financial institution a cool $16.65 billion for their role on the mis-selling of toxic securities in the run up to the financial crisis see LINK1. To be fair to Bank of America a lot of its problems comes from the fact that it took over Countrywide and Merill Lynch that did most of the mis-selling but this begs the question as to why the management of Bank of America took over these financial institutions in the first place. When you do a takeover please check out what you are buying ! There are so many takeovers that go wrong anyhow and it begs the question as to why you want to takeover a failing financial institution in the middle of a financial crisis it just seems to be a stupid thing to do. The same thing happened with Royal Bank of Scotland in its takeover of ABN Amro and Llyods Bank of Halifax Bank of Scotland both lost billions of pounds on those deals and had to be rescued by the UK taxpayer.

I live and work in London and as you probably know it is not exactly the cheapest place to live especially when it comes to house prices. One ratio that I like to look at is the house price in relation to the average wage. Well in London the average house is now £400,000 while the average wage is £39,920 so the house price to average wage is 10 times... a very high ratio historically speaking. But actually London is not the most expensive area of the UK in South Buckinghamshire the average property is £563,032 and average wage £27,903 so that means the average property is 20.2 times the average wage ! At some point these ratios will have to go down. The key will be when we get interest rates on the rise from their historically low 0.5% base rate the lowest in over 300 years. When interest rates rise, house price will fall and in my view fall a lot -  in the region of 30% if we ever get the interest rate back to a more normal 4%. There is a nice BBC story on the house price bubble here LINK1.

Yes the latest Treasury International Capital data LINK1 show that foreign governments, companies, hedge funds etc now collectively own over $6 trillion in US  Treasury securities. That is up from around $2 Trillion in 2006, this demand for US securities is quite staggering given that the US Federal Reserve has been happily printing close to $4 trillion dollars as part of its Quantitative Easing programme. So there you go Uncle Sam still seems to attract foreign buyers for its government debt despite the current yield being only around 2.4% on the 10 year bond. Seems that  the largest holders are Japan and China each holding $1.2 trillion a piece.

Yep the German 2 year Treasury yield is now -0.01% and the 10 year yield a new low of 1.02%. These are crazy low yields when you have positive inflation ! If German inflation over the next 10 years is 1.5% then you are prepared to take a negative real yield of 48 basis points. Why does anyone want to lend to the German government at a loss? Maybe I should give up being an economist. Something is not right when governments are able to borrow for long periods of time at less than the expected inflation rate. The five year bund is just 0.21%.

A lot of people ask me where they should invest their money for the next decade or more and I have a quite simple answer invest in a basket of African economies! Note not just on one African economy as you may pick a real winner or a real dud but a basket of companies in Nigeria, Kenya, Egypt, South Africa and Algeria will do you just fine over say a 10 year period in my opinion. The are African ETFs that can be brought or mutual funds with an African focus. Bloomberg has a nice story pointing out the progress the African economies are making LINK1. Sure there are risks of war, income inequality, poltical risk, lack of diversification in some of the economies but I think many of these risks will actually fall. Also they are gaining access to technologies especially via smartphones and mobile payment systems that are transforming their education and payments systems which will have major effects on long term productivity and their education is being transofrmed by acces to the internet.