How a Bursting Housing Bubble in China Could Slam the U.S.

China's housing crisis is much worse than the one in the U.S., according to a Chinese government minister, and given the scale of its pumped-up real estate bubble, suddenly deflating it could have global consequences.

"The housing market problem in China is actually much, much more fundamental, much bigger than the housing market problem in the U.S. and UK before your financial crisis," Li Daokui, a member of China's Central bank monetary policy committee, told the Financial Times.

The worst consequence of a burst housing bubble might be a huge spike in interest rates. But fear of an even bigger force -- Chinese citizens' anger at the high cost of real estate -- could tame China's efforts to constrain the housing market. (more)