HK Economy

I'm sitting at desk gritting my teeth over my eroding 401K, something we're all doing. But I can't help but think of the sweaty palms that local real estate developers must have right now. Check out this picture that I just took from my camera phone out the window of my office. Not a great photo, but illustrative nonetheless.
Foreground: The stubby little building with the cranes on it is the old Ritz Carlton. That building is not being built, its being taken apart floor by floor bit by bit. It used to be 3x the size. And by 'old' I mean that it was built in 1993, just 15 years ago, and its already being taken down! Had the developers a crystal ball in 2005 when deciding to domo this building, I can't imagine they'd choose the same path given this global economy. And taking it down has been boring to watch. It's not like Vegas where they rig a casino with explosive charges and raffle off a ticket to some lucky person who gets to push the plunger. No, they are too worried about collateral damage here.....but wait a minute, is that the tragically ironic new AIG building right next to it?!! Wouldn't want to break a couple of windows of that building!
Midground: You can't see it very well in this picture, but just beyond the old Ritz there is a large dirt area. This is landfill being prepped for more skyrise buildings, more commercial office space. For the past 2 years flatbottom boats have been shuttling in and out of Victoria Harbor full of rocks and dirt from somewhere in the South China Sea to fill in this land. Again, a lot of expectation being built in here.
Background: The unfinished building in the far background is the International Commerce Center. When finished it will be 118 stories tall, and the new Ritz-Carlton will occupy the top 15 floors of the tower! I'm sure rooms will command $700 and higher and a martini will be 25 bucks, but who is going to pay that in this economy? Real estate development is a long-term game and someday these properties will be minting money again, but in the meantime these developers must need heavy drugs to sleep at night.

I am a bit of a doomsayer, but I think this city is in for a serious economic caning in the year(s) ahead. It's audible to some while others choose to ignore it, but there is a giant sucking sound that can be heard throughout HK right now. Its the sound of a giant vaccuum sucking in people's jobs, property and land values, office space availability, small business, the beloved luxury goods market, expatriate perks, social club memberships, corporate expense accounts, $25 martinis, really any discretionary expense. This city is going to pay for the largesse its enjoyed for the past bunch of years.