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CNBC Quarrel About China’s Housing Market Bubbles Over on Chinese Internet

China’s real estate prices continue to skyrocket despite government efforts to rein them in to prevent a dangerous housing bubble. On March 5, American television network CNBC invited two analysts to debate the state of the sector. But when Peter Navarro, a U.C. Irvine Professor and the director of the documentary film Death by China, and Ann Lee, a New York University Adjunct Professor and author of the book What the U.S. Can Learn from China, began their exchange it quickly devolved into a shouting match, causing CNBC host Maria Bartoromo to cut the show short.

Chinese netizens quickly subtitled the show, titled “The China Factor,” putting it up online. In just over a week, the subtitled video has been viewed close to 1 million times on video portals such as Sina Video, Youku, and Sohu Video.

Navarro began the conversation by claiming that a possible collapse of the Chinese real estate market would do untold damage to the U.S. economy as China would dump more exports on American shores to make up for economic shortfalls. Lee then weighed in with the view that Beijing is doing all it can to cool the sector and diversify investment, saying there was “no bubble.” After Lee spoke for a minute or so, Navarro tried to interrupt her, calling her line of thinking “B.S.”

“Obviously, Peter is hostile toward China,” @梦剧场的清洁工 wrote in reaction. “From the moment Ann began, he kept interrupting her, with, ‘Let’s hear the comments from Beijing.’ In the end, he even said Ann was delivering ‘Beijing spin.’ It’s ridiculous that an economics professor analyzes problems by labeling people.”

“Peter is like an American ‘50-cent Party,’” @地之光 wrote, likening Navarro to a member of the teams of low-paid Chinese Internet censors who remove or contradict web posts that counter the Communist Party line. “If the other side so much as mentions Chinese government housing market regulation, he labels her a spokeswoman for the government.” “On the other hand,” the netizen continued, “Ann insists there’s no bubble in China’s housing market but lacks a substantive argument. Generally speaking, both economists have only a superficial understanding of China’s economy. Neither one offers any insight.”

But by drawing attention to China’s historically high housing prices, the video clearly touched a nerve among netizens. Ann Lee’s claim that there is “no bubble”—a claim tantamount to suicide for any independent Chinese scholar—became the main target of netizens’ derision.

“No bubble? Just demand?” @藿香789 asked indignantly. “Bad people use dirty money to accumulate hundreds of houses and force prices up. Is that not a bubble? People who really need housing can’t afford anything. Unless the whole family borrows money from everywhere they can and end up as mortgage slaves.”

Another netizen picked up where @藿香789 left off, pinpointing just who the “bad people” in China’s housing market are: “The government makes huge profits by selling land,” wrote @开心快乐是福龙哥专利. “Real estate developers reap colossal profits. And corrupt officials and speculators accumulate many houses for speculation. The empty houses and mansions owned by corrupt officials and speculators are everywhere in China’s big cities.”

However, what's really pissed off ordinary Chinese—and caused the CNBC video to spread like wildfire across the Chinese Internet—is the simple fact that securing a roof over one's head is, these days, a near impossibility. Tapping a strain of cynical and dark humor, Netizen @白领理财日记 satirized the high price of home-ownership and the amount of work it would take to buy a house with a post entitled “The Cost of Buying a House Across Different Social Strata”:

1) Peasants: Farming three acres of land since the Tang Dynasty—assuming no natural disasters.
2) Workers: Working seven days a week since the Opium War for 1,500 RMB per month.
3) White-collars: Working since 1960 with an annual salary of 60,000 RMB but no national holidays;
4) Robbers: Committing crimes 2,500 times for 30 years.