Remember Ordos, the ghost city?
Thanks to its coal, the place was “booming” (sort of). Not only was it a bizarre place with a real estate “bubble” (actually, I can’t quite want to find a word to describe something which is more than a bubble) even though the place is seriously over-housed, it was also a hot place for underground lending practices that we have discussed here every now and then.
But this city is dying. For a city which is clearly too large to accommodate its people, it is curious to see the headline on Sina that migrants are leaving Ordos. After the underground lending bust in Ordos, a lot of people involved in underground lending have gone bust. As the economy cools, together with the death of underground credit, the real estate market has died and constructions have halted everywhere, forcing people to leave.
In the busiest area of the city, Dongsheng district, 300 thousand migrant workers that used to be living and working in Ordos have disappeared after the bust as they can no longer earn the money they used to. The impact of a cooling economy goes beyond that. Services industries like restaurants are feeling the pain as their customers seem to have all disappeared.
There are some who are more optimistic, because “we still have coal”.