A long, steep slide in apartment prices has eroded China’s household savings
This literally only makes sense if you think the average household is fucking landlord! When the cost of my apartment goes down, I am spending less on housing, and my savings go up. What an insane thing to say
yeah it’s not good if the only thing that matters is to capture gains in profit instead of passing on cost reductions. if everything is financialized and built on infinite growth then those numbers need to always go up.
EDIT: when concentration of production occurs under a DotP and those large, near-monopoly companies are state-owned, then when you make productivity gains or technological advances those gains can be passed on to everyone via price reductions
Except reinvestment doesn’t matter if you aren’t capturing any labor value from that reinvestment. All of this financialization does not produce any labor value, which is why inflation goes up.
This is why, according to Adam Smith, in order to create wealth, real substantial wealth, the ‘wealth of nations (not individuals)’, you need to be able to direct that individual wealth into areas that produce labor value for the society.
Inflation and deflation are, according to Adam Smith and Karl Marx, essentially symptoms of the same problem. The problem of using fetishes (currency) and exchange value, to represent and derive labor value, when the two are separate things. But we can, in theory, integrate inflation and deflation into part of a formula that creates labor value.
The article actually claims apartments are not selling (I have no idea if this is true), and presumably the author’s explanation for this is either “people have less money so shrinking demand is lowering housing prices,” or “no one wants to buy a depreciating asset.”
China’s G.D.P. Stronger Than Expected, Led by Infrastructure Spending
Housing is getting too affordable.
Is this annualized growth? Otherwise this seems pretty high. NYT not sending their best.
This literally only makes sense if you think the average household is fucking landlord! When the cost of my apartment goes down, I am spending less on housing, and my savings go up. What an insane thing to say
love too fearmonger about deflation as if regular people who buy things don’t like lower prices
It’s a problem when society is lead by self-interested business men.
yeah it’s not good if the only thing that matters is to capture gains in profit instead of passing on cost reductions. if everything is financialized and built on infinite growth then those numbers need to always go up.
EDIT: when concentration of production occurs under a DotP and those large, near-monopoly companies are state-owned, then when you make productivity gains or technological advances those gains can be passed on to everyone via price reductions
The textbook problem with deflation is that rich people keep their cash instead of reinvesting it.
I’m sure this could be countered with wealth tax too.
But keeping the working class in a continuous economic struggle just to maintain their income is a desired outcome of inflation, I’m sure.
Except reinvestment doesn’t matter if you aren’t capturing any labor value from that reinvestment. All of this financialization does not produce any labor value, which is why inflation goes up.
This is why, according to Adam Smith, in order to create wealth, real substantial wealth, the ‘wealth of nations (not individuals)’, you need to be able to direct that individual wealth into areas that produce labor value for the society.
Inflation and deflation are, according to Adam Smith and Karl Marx, essentially symptoms of the same problem. The problem of using fetishes (currency) and exchange value, to represent and derive labor value, when the two are separate things. But we can, in theory, integrate inflation and deflation into part of a formula that creates labor value.
Doesn’t it also make sense if the average household has a mortgage?
mortgage payments usually aren’t linked to changes in the price of your house afaik? but variable rate patments change with interest rates
price of your house seems to only matter if you are selling or renting it (it has some effect on insurance too I suppose)
Apartments have become so cheap, people are actually spending their savings to buy them! Outrageous!
The article actually claims apartments are not selling (I have no idea if this is true), and presumably the author’s explanation for this is either “people have less money so shrinking demand is lowering housing prices,” or “no one wants to buy a depreciating asset.”