This is John Bachelor, conversation with my colleague Joseph Sternberg,

member of the editorial board of the Wall Street Journal. He's based in London.

He writes the political economics column, looking at China and the collapse of the real estate business, the crater of the

buildings across China these last decades. And what is to be done? Joe here identifies

that the response of the Chinese Communist Party looks to be

to do it all over again.

Subsidies got us in this fix, so let's subsidize.

Here's Joe Sternberg to explain how the Chinese Communist Party is digging the whole deeper.

More of this tonight.

Well, John, what we're going to talk about in a minute is this pivot to something other

than property but the measures that you're talking about are the panic that the

party seems to be doing instead right now because the story really since spring

this year has been that Beijing

appears to be worrying that maybe this property correction has gone too far

and precisely because they aren't sure yet what the next economic growth model is going to be.

The first instinct is to try to put a floor under property.

And so you're seeing all of these measures they've come out with which basically boil down to subsidies for housing and real estate related credit again.