Why China’s Deflation Is More Dangerous Than High Inflation | WSJ
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Published 2024-03-05
Like Japan in the ’90s, Beijing is also experiencing a real estate crisis. So how could this affect the U.S. and the rest of the world?
WSJ looks at Japan’s “lost decade” to explain why China’s economy is struggling and what it means for the global economy.
Chapters:
0:00 China’s economy
0:31 Japan’s “lost decade”
2:30 Deflation in China
3:56 Impact on the U.S. and the world
4:36 China’s response to deflation
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All Comments (21)
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when you're poor inflation bad deflation bad existence bad
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Prices can’t go down because then people get laid off, prices can’t go up, because people get laid off. I think the companies and their expectations of never ending profit increases are the problem
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"Deflation is bad because it's not profitable for capitalists" There. Summed it up for you.
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At 3:15 the graphs are very irritating since it isn‘t the same scale. Be aware of it because it would not look as bad as it does if they were equally scaled
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Oh I get it, people having impulse control and saving money for later = bad for companies and “deflation”. Who is it bad for again?
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The dominating class does get wealthier when everything is more expensive
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prices go down and wages go down. what's the problem with deflation? it's the problem only for people with debts, assets, and banks.
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Cheaper prices are bad? Stagflation is the worst thing.
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In the US where everything is always getting more expensive and wages aren't keeping up, this doesn't sound much worse.
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Deflation is good for fixed income earners.
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Deflation is the natural state of the economy as technological advancements remove inefficiencies in production, resulting in more supply at cheaper costs. Central banks offset this deflation with money printing resulting in the redistribution of wealth from everyone to the ultra-wealthy since they are able to access the newly printed money before everyone else. This is known as "the cantillon effect" described by economist Richard Cantillon.
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Economists worried, normal people happy.
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Homes are for staying, not for speculation. Price drop benefits home buyers at the expense of speculators and developers. Secondary sales volumes are up although values are down. Developers are encouraged to build government subsidized homes going forward. Evergrande could not get local financing a few years ago so issued foreign bonds so its bankruptcy hurt mainly the foreign speculators.
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Yes the Wall Street journal wants us to be worried about slower growth and lower prices…things that would be good for the planet, and good for regular people, but bad for billionaires. Mmkay
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Some deflation was necessary stop putting your portfolio above society 100% of the time
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falling prices benefit society. People are able to afford their life.
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despite the lost decade in Japan, is that country really doing so bad all these years?
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Deflation is good. Prices are too high now so we need much lower prices. A gallon of milk costs $5. It should cost $1. A simple truck costs $30,000. It should be $10 Grand. So we need a lot of deflation.
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Toyota camry price has not come down.
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“Oh no my money is worth more and prices are falling, this is a catastrophe!” Who are they trying to fool? The “deflationary spiral” is a myth
