China's bullet fast train crashed in a head on collision. The blame falls on official corruption, low quality (Chinese) signal equipment, and political pressure to meet deadlines.
Even though the promise was great, historically it was expected. There is nothing worse than the American fatal rail history. The US lived through such a bubble and disasters in railroad construction that hordes of railroad companies defaulted on their bonds. The US solution to the problem? The bankers became more involved in railroad operations to assure returns to foreign investors creating the Trust as the logical solution.
But it seems the biggest lesson for China is that their amazing economic minds are ignoring a basic principle of macro-economics: relative advantage. If they insist on building everything themselves, they will just have to take a number in the back of the line behind Latinoamerican countries after they fell in love with the notion of imports substitution.
