After the tech bubble and housing bubbles, the world is on bubble-alert, and armchair pundits are seeing bubbles in everything.

Like China, for example.

Last week, everyone seized on a video of a newly constructed--and empty--Chinese city as evidence that China was frantically overbuilding in an effort to keep its economy alive.

Other analysts are suggesting that China us building up enormous excess capacity to serve customers--like US citizens--who will be buying far less stuff than we were two years ago.

And everyone knows what happens when capacity gets ahead of demand...

But all that is bunk, says Mark Dow of hedge fund Pharo Management.

When you're growing 10 percent a year, the way China is, small capital allocation mistakes will be forgiven.  And the customers China is building capacity to serve aren't US citizens but Chinese.

So stop seeing bubbles in everything!