Living in China is getting cheaper. Because rents in my neighborhood in central Beijing are dropping, my wife and I pressed our landlord to reduce ours by $140 a month in a new lease that we signed last month. He wasn’t too happy about it, but he’s lucky that we didn’t move out. Given the desperation of local landlords, we probably could’ve saved another $500 a month had we switched to a comparable apartment nearby.
BUT AT WHAT COST?
Leah Fahy, an economist at the London-based research firm Capital Economics, expects deflation to persist through at least the end of 2026. She told me that in the absence of structural reforms, “it looks pretty likely that supply will continue to outpace demand.” The risk is that China tumbles into a long-term deflationary spiral that saps growth, much like the one that contributed to Japan’s “lost decades,” starting in the 1990s. To avoid that fate, policy makers need to reform China’s economy to encourage more consumption than investment and let market forces cull bloated industries.
embrace xiaohongshu thought
But China’s leaders do not seem ready to pursue these changes. Instead, the Communist Party’s latest five-year plan, a draft of which was drawn up at a party conference in October, seems to promise yet more state-led investment in manufacturing and technology, ensuring the supply glut may well persist for years to come.
wait I thought they were talking about encouraging domestic consumption as a main point of the plan
ohhh this economist is just ideologically against state subsidies for core industries lmao
Yeah, this just very thinly disguised laissez-faire propaganda. The main idea is just
. They even throw in a jab at Trump’s tariffs at the end because any interference with the all-knowing Invisible Hand is equally bad.Supply will outpace demand, which leads to less growth, economist says. In other news, more growth is being planned.
“Why would someone buy a dishwasher now if it can be cheaper tomorrow?”
…because people still need dishwashers?
“China has too much supply and too little demand”.
Cool, well here in the US we have the opposite problem. Not too good either. Besides, employers seem to be thriving when labor is high in supply and demand for workers is borderline nonexistent. How about let’s stop with the austerity and union busting to get people employed. Why bother hiring now when it could be cheaper later, right?
i don’t even buy that china “has too much supply/not enough demand” tbh. there are over a billion people there. you could find demand for anything you can supply
they’re conflating lack of overconsumption with lack of demand. they also export shit loads to the entire world so i dont see how they would possibly have that problem
just sounds like capitalist pig cope. i hate these people
BRB, going to hang a big poster of Mao on my wall and then ask my landlord to lower my rent since rent is much lower in China.
have you heard of georgism?
Are you shitposting?
i’m being serious - georgism is about abolishing rent in favor of public ownership and a land value tax. seriously!
Yeah, I don’t need niche ideologies.
Expropriate all landlords, nationalize all land.
