Lawrence Person's BattleSwarm Blog 8/12/2023
I have a whole host of “China is Screwed” videos I’ve gathered to post, but haven’t had the time to properly queue them up. So here’s a big picture piece from Peter Zeihan on China’s immediate economic foe: deflation.
https://www.youtube.com/watch?v=A9-wfHgjTB8-----
• Problem two: Deflation. The rest of the world suffered inflation when the lockdowns ended.
• “The consumption boom never happened, so supply chains never had to adjust. What has happened is people are less confident in their future, so they’re consuming less.”
• “We’re seeing mounting trade wars out of Europe, Japan, the United States, and increasingly secondary states like the Koreans are joining in. And that means the Chinese have fewer places to send stuff.”
• “Product that was normally produced for export from China is now being locked up within the Chinese system at the same time that the population is purchasing less. You have an oversupply of goods and an under demand, both at home and abroad. With all those extra goods prices go down, and you get deflation.”
• “This is what you would expect when you’re at the beginning of a deflationary spiral that’s caused by a fundamental mismatch between supply and demand, which is where we are going with deglobalization and the Chinese demographic. Trends which are now well past the point of no return.”
• Japan’s deflationary spiral lasted 20-25 years.
• Deflationary spirals are very hard to pull out of.
More:
https://www.battleswarmblog.com/?p=55592