China Rejects $1 Trillion Housing Rescue Plan Pitched by IMF

This isn't about people getting a place to live, this is speculation, like Bitcoin, but with housing. There's a mass of people buying housing to commodify it by selling it later at a huge price or by renting it out. This mass of people got scammed by housing developers who promised to deliver the apartment or house (at a good quality). Unfortunately, that didn't happen; developers ran ponzi schemes. They used investors' money to start new constructions and attract new investors, and stopped working on the old constructions or finished them poorly with bad materials.

This is how capitalism works unregulated. So the small investors fucked around trying to become petite bourgeoisie, and they're finding out the beauty of capitalism.

I know this is hard to hear for Americans, but if you're making money from being a landlord or flipping houses, you're a piece of shit.

Bailing out these investors would be like bailing out Bitcoin "common people" investors when the "currency" crashes.

edit: grammar

if they bought the houses to live and not speculate, it doesn't matter

Don’t pretend like China is some paradise where the common people aren’t getting fucked

• Reuters, 2018: China overtakes U.S. for healthy lifespan: WHO data
• United Nations, 2019: Helping 800 Million People Escape Poverty Was Greatest Such Effort in History, Says Secretary-General, on Seventieth Anniversary of China’s Founding
• The Economist, 2021: At 54, China’s average retirement age is too low For most men in China the age is 60, much lower than the average of 64.2 in the OECD, a club mostly of rich countries. For female civil servants the age is 55; for blue-collar women it is 50.

Oh no! The millionaire is now not a billionaire... And the developer was sentenced to life in prison.

Anyway...

meanwhile in the real world

Chinese household savings hit another record high in 2024 https://www.wsj.com/livecoverage/stock-market-today-dow-jones-bank-earnings-01-12-2024/card/chinese-household-savings-hit-another-record-high-xqyky00IsIe357rtJb4j

The real (inflation-adjusted) incomes of the poorest half of the Chinese population increased by more than four hundred percent from 1978 to 2015, while real incomes of the poorest half of the US population actually declined during the same time period. https://www.nber.org/system/files/working_papers/w23119/w23119.pdf

From 1978 to 2000, the number of people in China living on under $1/day fell by 300 million, reversing a global trend of rising poverty that had lasted half a century (i.e. if China were excluded, the world’s total poverty population would have risen) https://www.semanticscholar.org/paper/China’s-Economic-Growth-and-Poverty-Reduction-Angang-Linlin/c883fc7496aa1b920b05dc2546b880f54b9c77a4

From 2010 to 2019 (the most recent period for which uninterrupted data is available), the income of the poorest 20% in China increased even as a share of total income. https://data.worldbank.org/indicator/SI.DST.FRST.20?end=2019&locations=CN&start=2008

By the end of 2020, extreme poverty, defined as living on under a threshold of around $2 per day, had been eliminated in China. According to the World Bank, the Chinese government had spent $700 billion on poverty alleviation since 2014. https://www.nytimes.com/2020/12/31/world/asia/china-poverty-xi-jinping.html

https://www.worldbank.org/en/news/press-release/2022/04/01/lifting-800-million-people-out-of-poverty-new-report-looks-at-lessons-from-china-s-experience

I don't know enough about this specific situation. But the history of the IMF and World Bank is such that, if they were to put out a statement saying that the sky is blue, I would immediately go and check if it had somehow changed colour.

China already bailed out the buyers. Don't know where you're getting your info from. THIS perhaps? https://www.appropriations.senate.gov/imo/media/doc/FY21 BILL HIGHLIGHTS_SFOPS_final.pdf

https://www.congress.gov/bill/116th-congress/house-bill/7937/text?format=txt

https://prospect.org/politics/congress-proposes-500-million-for-negative-news-coverage-of-china/

Don't pretend like the average person in China is a fucking real-estate investor. This investment money is from the middle class and up i.e. people who don't need to be rescued. They're going to be fine. Even if their investments all go up in smoke, they won't be homeless. Common people just spend their paychecks and keep a little aside for savings, like everywhere else in the world.

I have you tagged as "shit lib and running for imperialism", it tracks that you have the same view as the US state department.

There were other positive feedback items happening as well, including local governments relying on development as the major tax base.

China is also likely to see a drop in infrastructure investment in the next generation, so having some of these companies collapse isn't seen as a major issue in China.