Chinese tycoon Huang Nubo plans to buy a large tract of north-eastern Iceland, enhancing the wilderness with a hotel, golf course, horse farm and race track (see a video report at The Financial Times). The purchase set The New Yorker’s Evan Osnos reminiscing about the excesses of Japan’s bubble in the late ’80s, such as ice cubes chipped from Antarctica and proposals for joint ownership of California:
And then, in September 1990, it burst. The Tokyo Stock Exchange lost nearly half its value in a span of four days. By 1993, the bubble was gone, carrying with it the “largest asset deflation in the history of modern capitalism,” Nathan writes in “Japan Unbound” (2004).
I couldn’t help but think about that moment this week when the world hyperventilated over the news that a man named Huang Nubo, a Chinese real-estate tycoon and weekend mountaineer, plans to buy seventy-five thousand acres of Iceland. He says he wants to build an eco-resort, but people in Reykjavik—still trying to disown their own mad boom and bust—can’t help but see specters lurking: a Chinese government plot to access the Arctic, perhaps, for the days when melting poles free up new resources? Or a water-play for glacial run-off …?
(See the FT video for Huang’s reaction to these suggestions: “I don’t know whether to laugh or cry ….”)
There comes a moment in every economic boom—whether it was the Texas oil boom in the seventies or Japan’s surge in the eighties or the Silicon Valley bubble of the nineties—when things get a bit weird. In retrospect, people like to point out that signs of overreach were always there, but of course they aren’t until they are. It’s hard to know how China’s Iceland moment will look someday: Will it be simply a quirky milestone on the continued ascent? Or will we look back on the last days of summer, 2011, as the moment when the ball reached the apex of its arc and paused, weightless for a moment, before beginning its fall?