With China buying up and hoarding world commodities, huge monetary expansion, and an Asian style savings style, could we see them follow Japan's lost decade? The Chinese economy is continuing to grow, but only by their government intervention in the economy, forex markets, and huge monetary expansion. Since China is pegged to the USD, they are bound by the federal reserve policy. Therefore, they have a massively inflationary monetary policy. The problem is that assets will get overvalued very quickly just as Japan did in the 80's. The next upturn in the world economy could put uncontrollable upward pressure on prices in China, which would eventually lead to a collapse similar to the US currently. The problem is that Asians are notorious for a high savings rate. That could cause the next Chinese business cycle to turn into a deflationary cycle.