Is there deflation in China's economy?
Two days ago, the eldest brother said that there is no deflation in the Chinese economy. What is deflation? Simply put, the money supply has decreased, resulting in slow currency circulation, and the most direct feeling of the people is that they have no money in their hands. Reflected in the macro perspective, that is, the people have no money to consume, and the company cannot digest the production capacity, so they begin to lay off employees, which makes the people even less money, which becomes a vicious circle, which is deflation.
Is there deflation? I think it doesn't matter whether deflation or not, behind the lack of consumption, the gap between the rich and the poor is the most worthy of concern. From the data, there is indeed no deflation. From 2019 to the present more than 3 years, China's M2 currency has grown by nearly 90 trillion yuan, and there is no reason for the currency to shrink more and more, but there is still two levels of differentiation.
Some people say that they receive calls from the bank every day begging him to borrow money, but some people say that their business turnover is almost money, but going to the bank to borrow money is not without collateral, or that what you do is too risky, and you can't borrow money alive.
Now the situation is rich and does not want to borrow. Those who have no money, those who want to borrow money cannot borrow money, drought dies, waterlogging dies. It is also difficult to see deflation from the recent hot search situation, such as Hua Xizi apologizing while refusing to reduce the price, selling more expensive than gold, you don't say that Zeng bought it. There is also the price of gold, the price of gold abroad is falling, and the price of gold at home has hit a new high. There are also various concerts, the highest of which has hundreds of thousands of tickets, and you can't grab it if you want to. Isn't it a National Day lately? Airfares skyrocketing, hotels skyrocketing, these all show that there is really no deflation, but is the consumption data without deflation really good?
Not necessarily. Industrial profit for January-July 2023 fell by 15.5% year-on-year. This also means that household consumption is very insufficient, and the profits of enterprises without consumption will naturally decline.
Why is there no deflation? Ordinary people have no money to spend? To put it bluntly, the gap between the rich and the poor is too big, didn't Li Jiaqi say that he couldn't afford it, and he had to find his own reasons? Now the reason has been found, one person feels expensive, it may be personal reasons, everyone feels expensive is not personal reasons.
Judging from the speed of China's economic development in recent years, long-term income is growth, and there is a big distribution problem in not being able to catch up with economic growth. The profits of state production did not feed back to the vast number of workers, but went to the hands of a small number of people, plus the cost transfer of land finance, so that the ordinary people, who already had only a meager income, put all their wealth on the house, and carried the pressure of loans for decades.
With the gradual fierce social competition, the cost of medical care and education is rising, all the money is spent on basic survival, and the people naturally have no money to spend. So deflation or not deflation, this is only a superficial problem, but the distribution problem and insufficient consumption behind this all point to the core problem of the gap between the rich and the poor.
Some people make money very simply, and the richer they are, the more they make money, sometimes they send a product at random when they are upstream, they have already guaranteed capital and made profits, and the risk is thrown to the downstream dealers and distributors who hoard goods, it can be said that they are kneeling for food, and how many people kneel and can't ask for it. And some people's business turnover may often be a little bit worse, but they can't find a way to borrow that little life-saving money, so how to solve the problem?
The enterprise side optimizes the loan threshold, and the resident side issues money to everyone according to the ID card. As long as there is money in hand, people will naturally spend money. The two-pronged approach has an immediate effect on production and consumption. Don't say that everything will be inflationary, M2 has sent so much to inflate early.
In short, a thousand words into one sentence, how to solve the worry is only to pay money.
