What if China ‘bubble’ pops?

World-renowned short seller Jim Chanos — the hedge fund manager who called the fall of Enron and the systemic problems cause by subprime mortgages –recently turned his gimlet eye on China. He saw a country whose rapid rise was hiding massive flaws: grossly inflated real estate prices, irresponsible construction lending, massive overbuilding, a banking system larded with bad loans, and unreliable government data. Fitch Ratings weighed in this week saying that China’s banks face the greatest “bubble risk” of any Asian country.