Comments by "Winston Smith" (@kryts27) on "Chongqing’s Economy Completely Collapses! Government Officials Beg People to Spend" video.
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The lack of consumption across China must affect treasury revenue, particularly in taxes. "Looming deflation"? It's already been there since 2022.
It's an economic (and psychological) depression environment, like the United States in the 1930s, now in China. Lack of consumption leads to lack of jobs and failure in small business (which is also collectively, a large employer). Without consumption and real estate, banks also suffer as loans are defaulted, no growth of loans or savings.
The US left the depression environment in 1941, not principally due to rearmament (which mainly occurred later during World War 2), but mainly concurrent population growth that restarted consumption and an improvement in banking and consumer protection laws that stimulated investment. China cannot look forward to population based consumption growth in the future, partially as a result of the One Child Policy and one of the world's lowest (birth rate) replacement values. As for investor confidence? The Xi Jinping dictatorship has killed that.
The rest of the world is not feeling much of the depression that is now constricting China. This is because CCP has partially acted as an autarky (to limit foreign debts), i.e. limiting importing finished goods manufactured by other countries via sky-high tarrifs. As a result, the world has bypassed China as a buyer of finished goods and is not much affected by the depression there.
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