Michael Friedmann has some wonderful examples why the Chinese economy might be considerable overheated:

"I live in a great apartment in Shanghai - well over 1,000 square feet partially furnished in a new building with two balconies and one block from the subway. Everyone tells me I shoud buy it. I'm not going to touch it - I firmly believe that Chinese residential property is overvalued. The Economist describes "Chateau Regalia", a gated luxury development ourside Beijing with houses ranging from US$720,000 to US$1.5m."