As the Chinese economy rebounded during 2009, we were often asked why our portfolios tend to have little exposure to companies in that country. In this paper, we address this question by looking at China both from a top-down and bottom-up perspective. Our conclusion is that economic growth in China is being driven by a massive government-led fixed investment. Additionally, we are skeptical that the policy of focusing on capacity growth at any cost is sustainable. This becomes clear when one looks at the deteriorating profitability of the State Owned Enterprises in the infrastructure sector.