Because the demand is still there. I've mentioned before, I was in China last summer and the building is STAGGERING. I mean jaw dropping staggering.
In 7 cities, every single one with no exception was covered with tower cranes as far as the eye could see. Each Chinese city had probably as many tower cranes up as most populous US STATES have in the entire state. Out of my hotel window in Beijing, facing only 1 direction... I counted 25 tower cranes within the smoggy view, all working above the 15th-20th floors...
The view was the same from Xian... deep in China's heartlands, almost to the Gobi desert. Tower cranes.. EVERYWHERE.
I could not even imagine before going there that building could progress at such a rate... not in one area, but every single region of a nation that size. I wonder if the US EVER had so many tower cranes or simultaneous building in our 200 year history. You have nooo idea what is coming...
There will be no reduction in demand for materials for years. There's been a shortage in the US of concrete, because China was buying it all, to the point that many US builders were RATIONED on how much concrete could be bought for a period of time. I believe China cranked it's own production on concrete over the last year or 2.
China of course would be hurt badly by any recession in the US... they finance our economy right now, and vice versa. All that deficit and debt... you don't think it takes place in a vaccum? They LEND us money so we can SPEND it with them. The end result being they get richer and we get poorer... and we just do not realize it. Or realizing it, we do nothing about it because we can't.
Exactly like foreclosing on someone's home leaves the bank with a house that cannot be sold. So they lend more in the form of interest abatement or whatever.
I don't think the market is going to crash and burn imminently, but when it comes, it's probably going to be bad. Materials however will likely hold up better than other sectors, and everyone knows it, which is why it keeps growing.
