Chinese economic train wreck?

I do not know Jim Jubak's credentials but what he says seems to jive with the current situation and his projection seems to be plausible. From MSN/Money:

China's economy is out of control
China is growing so fast -- using cheap money to build steel mills, highways and textile factories it doesn't need � that the coming crash grows uglier by the day.

In a train wreck, there comes the moment when it's no longer possible to avert disaster. Pull the brakes as hard as you can, the momentum of the train is so great that disaster is unavoidable.

I fear that China's economy passed that point of no return in the second quarter of 2006.

Today, I'm going to tell you why I think China's economy is headed for a train wreck. Not tomorrow, but in the reasonably near future. I'd say 2009.

And in my next column, I'll sketch out the likely effects of that train wreck on the rest of the global economy and the folks, like you and me, who invest in it.

If you've been following the debate in the U.S. about the likelihood that cheap money here has produced a bubble in housing prices, you're already familiar with the basic scenario for a train wreck in China. Cheap money makes it easy to borrow to buy assets. That produces an asset bubble -- in the United States, first in stocks and then in real estate. As the asset bubble grows, borrowers get in over their heads as their judgment is overwhelmed by the excitement of rising prices. And lenders under the influence of similar emotions make loans to unqualified borrowers.

When the asset bubble starts to deflate, overextended borrowers default on their loans, putting pressure on lenders, who respond by tightening their lending standards, reducing the amount of money available to all borrowers. That sends the economy into a slowdown or worse.

It's a longish two-page article but if what he says is true, China is due for some bumpy times not that far down the road. Since they are now buying so much of the worlds (read: Middle East) oil, it will also be interesting times for our Arab "buddies". Couldn't wish it on a nicer bunch...