China’s Consumption Downgrade: Skip Avocados, Cocktails and Kids
nytimes.com
nytimes.com
But from a purely economic standpoint - saving is not a bad thing. Murray Rothbard wrote the following (fairly obvious statement):
"To increase production, man must form capital. To create it, he must restrict his consumption and transfer his labor for that period to producing immediately-satisfying consumers’ goods."
The article explicitly mentions the -goals- of those who are saving - to buy homes or raise children. Henry Hazlitt writes:
"But when money is invested it is used to buy capital goods–houses or office buildings or factories or ships or motor trucks or machines. Any one of these projects puts as much money into circulation and gives as much employment as the same amount of money spent directly on consumption. “Saving,” in short, in the modern world, is only another form of spending."
In other words - Why would it ever be bad that people are -expanding- the time horizon of their goals (favoring long term investments over short term ones - ie: houses instead of lattes)? If anything, this ought to be an indicator of a strengthening economy, even if it means "slumping" share prices in the meantime.
- From wages, which are paid by enterprises that create the goods that are consumed
- From investment gains in enterprises that create the goods that are consumed
Its consumption all the way down.
If we live more consuming lifestyles, we drive up the demand for resources which could increase the motivation of people to get them and thus drive economic growth short-term, until/unless we use up the resources entirely. And that all still ignores externalized costs (pollution and other harms) that can come from the extra consumption.
There is an order to things. It all begins with first producing/making something, no matter what segment of the economy you're talking about. Sure, you can start by borrowing (from someone else that has produced something), and eventually you still have to produce to pay for that front loaded consumption.
Further, how do you plan to continue consuming sunlight on your skin, without producing something to then get food and shelter to survive another day or week of absorbing sunlight? How did you buy that living time in the first place, without producing anything to get you food and shelter to be alive in the present? Someone had to produce first.
And if you want to go more elaborately into the concept economically (sunlight based energy generation), you need land and technology to turn that sunlight into consequential electricity. You must produce first to generate and consume the sun-based electricity.
The benefits of sunlight can only be acquired if one has acquired a place on Earth to stand, suitable places to stand have been enclosed by land titles, and land rent or profits which can be acquired from ownership of these titles without having to produce anything make up at minimum 20% of national GDP.
Land and sunlight are consumed by virtue of occupying a physical space on Earth, and play an extremely large role in the economy, but land and sunlight were never produced by the economy or as a result of economic processes. They are instead the product of natural physical processes which pre-existed the evolution of humans.
All goods are certainly not the result of economic production, as this would create a chicken-and-egg problem where human civilization could not exist unless another human civilization was around to produce it.
It is called a durable good. Land is about the most durable of all.
Consumable is another name for a non durable good.
Use of consumer durable goods is not the same as consumption - it is typically considered depreciation.
The process starts with government who can spend money without producing anything. Where do you think the actual currency units came from? Money doesn't grow on trees.
Just ask Venezuela how monetary production with collapsed supporting production works out.
Yeah, this isn't how it works at all. Not surprising that people like you don't grasp very basics but try to think this through carefully:
Governments can and do regularly summon and dismiss debts out of thin air. It's the very definition of sovereign.
Venezuela's problems, like all sovereign debt problems before and since (see Germany, Zimbabwe, Rome), are due to its external dependencies. It has external debts. That means it participates in relationships where it is not a sovereign. Do you really think if Venezuela didn't need to import certain items (and therefore didn't need to borrow dollars) it would have any problems at all? And so no, "monetary power" actually has nothing to do with production capacity.
In fact it is the only real capital that exists. The rest is just leverage. In a real economy all debts must be settled with sovereign debt ie currency.
> The government could give everyone a trillion dollars, but whoever actually owns land and factories and natural resources will still be the people with capital.
You've fallen to our own confusion. This is the classic mistake of people who don't understand Marx: the mere presence of assets doesn't make you a capitalist. Everybody has assets. It is only the people with currency (more precisely, the people owed currency) that are capitalists because their assets are sovereign liabilities and therefore must be accepted for all debt settlements. The "inside economy" can actually grow as long as people accept the sovereign debt for payments. The only limit of this process are the sovereign's borders and the existence of foreigners who refuse to be paid with the sovereign debt.
This is important, particularly if you want to understand what's actually happening in China, where the entire system is driven by massive amounts of sovereign debt but the country as a whole has zero external debts (including its external assets). Growth, as the last forty years of China's history makes very clear, is not limited by any kind of exogenous investment. Countries don't need to borrow money to grow despite the narrative pushed by the global bankers.
I agree with and accept your points about debts and liabilities etc., and they don't seem to conflict with what I was saying otherwise.
Maybe we just agree and are clarifying semantic terms…
Yes, we agree. My point is that "private ownership" is just another way of saying that people have accumulated sovereign debt. There's no reason the sovereign must issue these debts by the way, the sovereign could directly seize control of all assets and try to satisfy all wants itself, but these days everybody pretty much agrees the sovereign should issue debt and not try to do everything itself.
When it comes to growth, (the original question, "Where does the capital come from that flows in to savings?"), all of the debt in the system (particularly the private debts that are created when capitalists borrow and lend money) must be leveraged off existing stock of sovereign debt. If there was no sovereign debt there would literally be no money (in any form) to invest or borrow.
As far as creating currency, as I understand it, it works out to be a lot more effective and efficient for the state to issue that debt-currency (and create demand for it through taxing it back) and thus create markets using it than to directly manage resources through a top-down bureaucracy. (To be simplistic admittedly)
P.s. Houses are a consumer
When the imports get more expensive because of tariffs it's by definition the tariffs imposed by importing country, i.e. China in this case.
I tend to celebrate such fair, intellectual posts! But in this case… consumption as economic indicator isn't just troubling, it's horrific.
Our economic measures are not just mediocre, but actually destructively backwards. They are measures that actively push us to catastrophes, unhappiness, destruction…
GDP etc. would triple instantly if we just paid our neighbors to do one another's housework.
[1] https://en.wikipedia.org/wiki/Tragedy_of_the_commons
[2] https://www.georgesoros.com/2012/06/02/remarks_at_the_festiv...
Edit: I agree with you. If you'd dropped the lead sentences you wouldn't have been downvoted. HN as a whole seems to react badly to hyperbole, but positively to unjustified, broad, faux-intellectual claims. Haha :)
My hyperbolic-seeming opening line was actually emphasizing that it's not even hyperbole. AND I CAN'T EDIT to emphasize that I was NOT being sarcastic! (I realize now people probably guessed I was sarcastic when I was actually sincere).
The classic models of economics really are that bad, no exaggeration. The post I was replying to was both correct and truly understated.
I think the tragedy of the commons is just an example of a whole class of similar phenomena that exist and that classic economic models ignore.
And you're plainly right about the "mass psychology" macro-level stuff, but that's also not the whole picture.
The core issue is that macro level phenomena are real. So much economics today actually claims that macro is nothing more than aggregate micro (and they get micro wrong too, with simplistic understanding of psychology when considered at all and so much else).
I heard this analogy from a friend (don't know the original source though): assuming we can understand macro by studying micro is like saying we can understand the behavior of a gas by simply tracking the isolated locations and movements of single molecules!
This is nice in theory but certainly false in practice.
In practice much of the price paid for capital-goods is not for capital at all, but for land and monopoly priviliges. In real estate, the land share of real estate value can be 60% of the total investment.
Payments for land and investment in land purchases are always surplus payments beyond what is necessary to bring land into use as a factor of production, because land is a fixed natural resource which does not have a labor cost of production.
When investment in land increases through land banking, this increases the opportunity cost of investing in businesses which employ labor to produce goods and services, which decreases the demand for labor and lowers wages.
Policies which are designed to increase investment and savings over consumption typically decrease economic output and slow growth, because while increased consumption of labor produced goods and services increases the profits for investing in productive businesses supplying these services and the demand for labor, increased investment does not necessarily increase the demand for labor or the supply of labor produced goods and services at all.
It's possible for policies promoting increased investment and savings to promote nothing more than land banking and investors holding empty parking lots while waiting for a speculative increase in price.
If all land was owned by one evil monopoly, and it was slowly being sold, even at insane prices - is that not productive in the sense that land in the future is more distributed than land in the past? Certainly it seems to me to be at least as worthy as short term entertainment and luxury - particularly ecologicaly - but purely economically too?
Anyhow - you’re not wrong at all - investment in land is certainly one of the things being favored instead of coffee - but this seems exclusively like a value judgment to me (who is to say what the price of land ought to be but the owners of the land?)
Factories producing a lot of income have capital efficiencies much higher than that.
Consumer goods do not have any kind of capital efficiency. This means that typically their total economic efficiency is lower, sometimes much lower, than 1.
(note that certain goods can be considered both capital and consumer, e.g. cars - it depends on use)
Taking this to an absurd extreme, the last human alive could have all the money in the world and it would do them no good at all -- all that money would have exactly zero value (well, the cash could be used as fuel or toilet paper, but that's it, and most money isn't and wouldn't be cash anyways).
Now, a society might be able to survive having an inverted population pyramid for a while, or even a very long time (generations) but e.g., dedicating more of its economy and people to elder care, by automating more of elder care, and so on. So it's exactly not all bad. Nor am I saying that fertility rates should be above replacement rates -- we all know that we can't have exponential population (or even economic) growth without end on Earth. But do note that an economy with a long-term inverted population pyramid tends to be inflationary: the elderly will have a lot of money (as usual), yes, but it will be chasing a smaller population of service providers.
Talk about Childhood's End.
Sustainability yes, self-destruction no.
In the long-term I do assume -perhaps wrongly!- that countries with negative population growth will eventually stabilize their fertility rates at replacement rate (probably with an overshoot on the upswing).
I'm not an economist, but from what little I know, the Neoclassical / Solow-Swan model¹ ² defines output as a function of Labor, Capital and Productivity. Long story short, consumption doesn't drive economic growth.
__________
The primary impetus of the development of neo-classical theories economics excluded was United States government land grants to railroad companies during the westward expansion of the 19th century. The railroad barons took over the economics departments of private universities which were previously controlled by the clergy, began firing professors which held to classical economic theories, as there was no tenure for professors at the time. They instead began funding professors such as John Bates Clarke, who repckaged Marxist economist theory that capital was 'jelly' and land and natural resources no longer exist.
"Neo-Classical Economics as a Strategem against Henry George" documents how land and natural resources were removed from classical economic theories during the development of neo-classical economics in order to promote the interests of wealthy land owners in the United States during the 18th century:
http://www.masongaffney.org/publications/K1Neo-classical_Str...
As for good and bad investment, let's take an absurdist example for fun and clarification. A savings bank lends individuals' savings to two farmers for their yearly crops.
Farmer A plants a 10,000 seeds of barley, and his neighbor Farmer B plants what are essentially small stones, 10,000 sterile seeds (perhaps he's been duped by someone or by his own misguided ideas into believing that they're fertile).
Both farmers will spend the same on labor, water, perhaps the same on the seeds, and so on, so the savings will be turned into spending as Hazlitt says, but their harvests will clearly be different. Farmer A will reap a growth in total value, while the planter of sterile seeds -- Farmer B -- has created no new value despite having spent the savings lent by the bank, which he now must repay. Because of his bad investment he can't repay the bank and must sell his farm.
If it turns out that many other farmers also planted these sterile seeds and can't repay their loans (other people's savings) the bank will default and great harm will be done to the community (who, if this is an idealized small and local economy, must also deal with a reduced supply of grains).
Instead of farmers planting sterile seeds, in China you have local governments planting sterile infrastructure projects and borrowing heavily to do so. The debt on these and other projects is mounting at an alarming rate. Why are these sterile seeds being planted? Because the easy infrastructure investments have already been made, and there is little other means to create 6% GDP growth without either increasing exports (ahem) or increasing demand, in other words increasing consumer spending so that savings could be invested in the creation of products and services to be sold to households rather than in sterile infrastructure projects.
The best explainer of this stuff that I know of is Michael Pettis, who teaches finance at Peking University. Here's a relevant article from his excellent blog: http://carnegieendowment.org/chinafinancialmarkets/72997
EDIT: By the way, increasing household income is the best justification I've heard for Xi Jinping's extreme and otherwise frightening power grab, because a shift like that (increasing household income) requires going against mighty interests: local governments and the wealthy.
Well, the problem with using that statement to downplay consumption is that it starts with the objective of wanting to increase production. But why would one want to increase production? Because demand(consumption) demands it.
And rightly so. It's basically an indicator of how fast a society is turning resources in trash for profit. Probably it wasn't always like this, but nowadays I think that's the only metric it represents.
About the only thing that popped out at me is the line "She makes about $1,400 a month after taxes, but nearly half of it goes to the rent on her one-bedroom apartment."
Maybe housing costs are what's causing the slump (if there is one)? Around where I live I see stores closing all the time and I'd bet the #1 reason is that rent is too damn expensive.
Shoot, having a place all to yourself is one heck of a luxury in those cities. Plenty of people there are having to skip nice things if they want to live in a place like that. All while paying off student loans, while their careers are still in the early stages.
Having housing owned by absentee landlords who live halfway around the world is mostly negative for a city’s residents (though might benefit some local property owners whose property values are thereby inflated). Remote owners for the most part don’t care about maintaining their property, improving the local neighborhood or city, forming relationships with tenants, etc., and sometimes even leave units unoccupied for extended periods of time, taking housing stock off the market.
I hope governments figure out some way to impose substantial additional taxes on non-owner-occupied housing, especially when it gets to large scale, or when units are kept unoccupied. The purpose of housing is to provide a place for people to live, not to build a fortune for a few capitalists, especially ones who are not local and are therefore largely unaccountable for bad behavior.
Sure, if you want to talk about Colombian narco-dollars, or Russian keptocracy.
China has a huge middle class, who worked all their life and had mandated government savings, with a pension for women at age 55.
Please, do not write down all foreign investment in property to stolen money: Chinese purchasors in the west of small to medium size flats, and houses are buying for three reasons
1) the cost of property in Beijing is too high 2) their children are doing masters or phd programmes in the economy and its sensible to invest and save the kid rental 3) they want an exit strategy for their life savings if things go bad in the home country
They are not kleptocrats. This is not stolen money. This is 30 or 40 years of savings, coupled to insane property bubbles.
[Edit] I know some of them. I talk to them about this. I am not reporting from things I read, this is what I know from my neighbours in my apartment complex.
However, even just “middle class” millionaire foreign investors parking money in international real estate is highly problematic for the places where the houses are.
As an example, my parents live in a quiet suburb of Los Angeles, and recently a few of the neighboring houses were bought by foreign investors. Maintenance has all but stopped. One house was rented long-term to a group of college students who used it as a party house. Tenants move in and out of those houses within a year or two instead of staying long term. Any communication goes through a scummy property management company.
If a critical mass of houses get like that, the neighborhood becomes a much different place. Everything becomes transactional and low-trust. The only way to get stuff fixed is by filing formal complaints or threatening legal action. Minor problems just pile up because it’s not worth the trouble. People stop caring about making things pleasant, or even making them work. Remote owners and management companies are just there to make a buck, and tenants are just temporarily stopping through for a place to sleep while they work out something more permanent elsewhere.
The negative effects of this are masked when you have abundant supply, like in random suburbs in the midwest, but shows its ugly side when supply is constrained and the investment aspect far outweighs the utility people gain from using it as a house.
The real (and only) reason is a mismatch of supply and demand. Mostly supply though. Localities pass very strict real estate policy which prevents construction, which lowers supply, and so naturally prices go up.
Tokyo japan somehow is able to house 11 million people, at reasonable costs. What do they do differently? Allow construction and have intelligent zoning.
If cities like SF/NY/etc were allowed to build, prices would come down, and those foreign investors would be revealed for the nice people that they are - ones paying property taxes to a country they don't live in.
The problem is not that foreigners are bad people (I’m sure most real-estate investors are “nice”), the problem is housing used as an investment vehicle. With the increasing ability for people to move money around the world, more housing than ever in world cities is becoming a magnet for remote investment. Foreign investors exacerbate problems which already existed.
In particular, large-scale and absentee landlords (including those living in the same country) cause more problems than small-scale local landowners, because they don’t have the time or resources to form local relationships, tend to care less about the property or the local environment, and are not as accountable when they act badly. This is just as much true when it’s Americans buying large amounts of property in whatever other country, or buying property in other cities within the same country.
I agree that a significant (but ideally gradual) drop in housing prices based on changing zoning laws and increasing housing supply (and ideally changing the tax structure, starting with e.g. repealing CA Prop. 13) would solve some of these problems. (Among other things, they would make housing an unattractive remote investment.)
I agree that many local landlords are terrible, especially in my experience those who own many properties.
Personally I think professional property management companies should be very strictly regulated, and both owners and management companies should face severe financial liability for mismanagement, and landlords should be taxed as much as the market will bear, with the proceeds spent on local residents.
But even in the best case, a property management company is never going to care as much as a good local landlord, and the best local landlord isn’t going to care as much as an owner-occupant.
For rented properties, taxing the landlord is taxing tenants (indirectly, but tightly, linked). Those local residents that you want to spend the money are the tenants in most cases.
When housing is limited, excess demand (competition among tenants) already pushes prices above the landlord’s costs. As a result, the landlord pockets an unearned profit.
In such a situation taxing landlords does not change prices paid by tenants because they are already paying as much as the demand side of the market will bear. It just redistributes the profit toward public uses.
For more about this basic idea, see https://en.wikipedia.org/wiki/Supply_and_demand or your favorite high school economics textbook.
Yes, that's how the business cycle has worked in western countries since the classical antiquity. The largest component of urban housing costs is the price for access to land, and payments for access to land are surplus payments beyond what is necessary for land to be supplied, because land is a fixed a natural resource with no labor cost of production.
An increase in land banking and the holding of real estate for investment purposes decreases the supply of land available, increases payments for access to it. This increases the market valuations for real estate value based on the increase in the capitalized value of future rent payments. This increases the opportunity cost of investing money in productive businesses which employ labor to produce goods and services relative to putting money into land. This decreases investment in production of non-land goods and services which have a labor cost of production, which decreases the demand for labor, which decreases wages.
Decreased wages then lead to decreased consumption which leads to decreased ability to pay rent, which then results in a drop in property valuations based upon capitalized rent payments. After a sustained period of rents increasing faster than wages, the property bubble usually pops and results in an economic depression.
One solution to avoid this problem is through taxing and redistributing surplus land rents through a land value tax, which countries such as Taiwan have implemented. China has people smart enough to clear this hurdle and find creative solutions to continue rapid growth, but since Xi has consolidated power and gone back to heavily promoting Marxism as the economic model for China's future, the current political situation makes it seem unlikely that they will actually do so.
An average fancy lunch costs CNY25 in the most expensive part of the town. Living a careless life on $700 per month can be done effortlessly.
To note, China is a freaking HIGH tax country. Earning $1400 post tax means her gross income must be around CNY25000 with freebies and perks, which makes her into top 5% of the workforce. She earns almost as much as engineers do.
In 2002 I recall eating a huge bowl of noodles in rural Yunnan for CNY1. Today an average "fancy lunch" costs at least CNY60 in a Tier 1 city. Hell, even one beer usually costs that. That's USD$10.
In Shenzhen, an average bowl of noodles is CNY20+. (The cheapest of the cheap, if you can find it and are willing to eat it, is about CNY8-16.) In the airports it's CNY60+ nationally. In high speed trains nationally a central kitchen produced low quality mass-meal in a thermoform container is CNY45, and perhaps purchased by 1/3 of travelers.
For more reference prices take a look at http://ele.me/ delivery service. The delivery fees alone are around CNY7 (USD$1+). This is not "fancy lunch in the most expensive part of town" but "the stuff the average white collar worker eats daily".
These are prices in an award winning place in downtown Shenzhen https://imgur.com/a/XqTC9zE
For a snob, one can go to Michelin rated Putien where you can get few very satiating dishes under CNY40
PS. Downtown Shenzhen is called Futian (福田; "abundant fields") not Putien (which is not even Pinyin, suggesting you are an overseas Chinese person or foreigner with little mainland exposure). I have been based here for most of the last 18 years.
Are you in SZ right now?
The title is a little strange: avocados have been a luxury item for as long as I've been in China. A single, medium-sized avocado usually costs between US$1.50 and $2.00. Avocado toast isn't a staple like it is in SF.
And, anecdotally, I've seen more cocktail bars and craft beer places open than I've seen close.
Up until the 17th and early 18th Century most of global wealth was located in China and India. Its what made them prime target for the militarily strong Europeans.
I have been to Europe, Asia and the Middle East and people are almost the same.
So how can I explain the widely different living standards ?
The only answer that ever made sense to me was colonization.
You can see the equalization happening with Britain and US having third world style politics, corruption, etc due to having to learn to live in world without their hegemony.
As for democracy, do you think China could have survived democracy ? It would have ended up like Iran. Democracy only works if the country has strong institutions which China doesn't have, they still send their best and brightest to US universities.
Ideologically, I'm opposed to the Chinese government and always felt they deserved to fall, a little like the USSR. The idea of political incarceration sickens me to the soul. So the articles delighted me, a shameful delight in another's misfortune.
But these articles come out promising a herald of an imminent decline and they still climb.
Now I have a grudging respect for their emergence, and a less rosy view of the virtues of Democracy, after it did little but cause misery in much of Iraq, Afghanistan and Russia.
Perhaps this time China will finally succumb to its prophecised doom. More likely, I suspect, I will be reading on HN about another compelling portent of China's imminent decline in a year's time.
debt to GDP https://www.bloomberg.com/news/articles/2018-02-08/sizing-up...
2008 - 150%
2018 - 350% (official figure) 450% (official figure plus shadow debt)
gdp growth https://tradingeconomics.com/china/gdp-growth-annual
2008 - 12%
2018 - 6%
children per women http://www.china-profile.com/data/fig_WPP2010_TFR_1.htm
2008 - 1.75
2018 - 1.5
China lost 4 trillion wealth to migration https://www.forbes.com/sites/insideasia/2017/02/22/china-cap...
Nothing goes up forever. Eventually they come crashing down to earth. Noone escapes economics fundamentals.
Meanwhile Czech, Romania, Slovakia, Poland, Estonia, Latvia, Lithuania - all of which are Democratic, and all of which have had superior economic outcomes to Russia - haven't had that problem. Turns out when you forcibly hold a giant land mass together that shouldn't be together, there is a high cost.
Was Russia expected to snap instantly into a perfect Democratic model from that? How many elections did they hold that were Democratic before returning to a dictatorship? Not a very long experiment as it turns out.
When did Iraq get Democracy? Was that before or after the vast civil war that killed hundreds of thousands of people and demolished its cities; or was it before or after ISIS ripped the country in half? Immediately after leaving a brutal dictatorship that had tortured the nation for decades? Another mass of land arbitrarily forced together by a great power, with horrible consequences.
Afghanistan got its Democracy with a helping of decades of religious civil war that decimated the country and continues to this day with everything persistently under attack by the Taliban. They're expected to accomplish what beautiful form of Democracy in that atmosphere of on-going civil war?
Using those three as examples of Democracy causing misery, is plainly absurd.
It took a few years for the Russian mafia to consolidate power, but now the country looks to this outside observer like a mob-owned dictatorship with a weak economy, weak state institutions, little public accountability, no future orientation, poor career prospects for the well educated, etc. The main sources of power are (a) sizable natural resource reserves including gas, (b) nuclear weapons, (c) a shameless government which is willing and able to stir up a lot of shit in other countries.
> When did Iraq get Democracy?
It’s hard to form any kind of “democracy” when a foreign military comes and destroys your local infrastructure, dismantles your local institutions, kills a substantial proportion of your population, sparks off a civil war, provides local paramilitary groups with loads of weapons, etc.
In addition to the imports, it sounds like a lot of the problem is due to rising rents and housing prices. I’m basically a broken clock on this, but a “strong” housing market is not necessarily good for the economy. Increasing home prices and rents can wipe out real growth the same way inflation can
Consumption of real estate is fine when it means building real estate that will actually be used (which China is doing a lot of, even though some is unused). It’s bad when it essentially becomes speculation on property values, and I would argue that it’s also bad when property values rise and that wealth creation is only captured by incumbents / people that got in the market at the right time.
Other consumption can be non sustainable, but at least it often directly leads to some quality of life improvement that a rent hike may not.
Being forced to consume less because you can't afford it in the moment is one thing. Being forced to consume less because there's less resource to use and transform, is a different thing.
1/10 failing nyt downgraded itself to 朋友圈 level. I had much higher expectations of this reporting. Give me more stats covering more industries. Not some imaginative figure from 1st-tier whining about living in a big city is costy.
The story was written before Alibaba's Q2 results were out, and says that if Alibaba is down, there's real trouble. Those results are out now, and Alibaba does not seem to have had a bad quarter.
Their profitability almost entirely disappeared as well. They're spending large sums of money to buy cheap revenue, and burning up their margin in doing so, swapping high quality sales for low quality sales. That might be ok if they didn't have a $442b market cap to support (which was premised on them generating a large amount of profit from a high margin ad platform).
It remains to be seen whether growth at any cost is a smart approach, or whether it's going to result in driving into a jarring brick wall instead. Junk revenue has consequences.
This is very surprising to me. This is the typical grad-student salary in the US (in CS), and in places outside of Bay Area, more than sufficient for a very decent QoL.
You have to do your own first hand research to get an idea of anything.
Example: the headline says "Shenzhen's property prices beat that of Manhattans" , but that only a half truth - average still climbs up, but median were going down for close to 3 years. Yes, the 400sqm mansion apartments did probably beat NYC long time ago, but who cares about them?
In overall, SZ market got push not due to demographics as popular narrative says, bur thanks to their (failed) universiade. A giant amount of property speculators, top tier ones at that, bought into the idea that universiade, just like the Olympics, will magically push property prices and Shenzhen will see its own share of Pangu plazas (the once most expensive apartment building in China). Well it just became the self fulfilling prophecy, but only for the top of the market.
Another thing few people know - Shenzhen spend more money on the universiade than most countries spent on the Olympics. To their disappointment, the event did not even sell half of all tickets, and went completely invisible to the outside world.
lifetime emissions of CO2 that are saved by different actions (US)
Increase car’s fuel economy from 20 to 30 mpg 148 Reduce miles driven from 231 to 155 per week 147 Reduce number of children by one: Constant-emission scenario 9,441 Optimistic scenario 562 Pessimistic scenario 12,730
So basically fighting climate change, or having kids who consume less, has a much greater impact.
(Global carbon use is up)
But I think the core point is that if individuals drop out of a market, that relieves demand which can keep prices down and thus allow others to keep consuming!
In other words, if many of us do the environmental thing and drive less, that just enables wasteful irresponsible others to more cheaply use up all the same gasoline in the end.
Or because LED lights got so efficient, places (in China incidentally) can plaster them over most of the surface of a building for no reason other than showing off, thus using up all the efficiency gains.
To actually reduce overall consumption and pollution, we need widespread social changes that make such consumption and pollution seem shameful (and/or illegal) even though the market price isn't itself discouraging.
The only market solution would involve effectively internalizing the now-externalized costs of pollution.