Babies before apartments.

While the rest of the world is battling inflation, China's prices fell in July. "Retail prices in the country fell by 0.3% in the 12 month period ending July," wrote Vivek Kaul. Producer prices have fallen for 10 months in a row. "In July, the fall was 4.4%, implying that wholesale prices at the factory level have been falling for 10 months now." "China's goods exports in US dollar terms fell by 14.5% from July 2022. At the same time goods imports fell by 12.4%." To add to its problems, "China's fertility rate is estimated to have dropped to a record low of 1.09 in 2022, the National Business Daily said." Reuters. The replacement level of total fertility rate is 2.1, below which the population will start to shrink. wikipedia. "Hong Kong's Family Planning Association said in a separate release...that the number of childless women in the special Chinese administrative region more than doubled from five years ago to 43.2% last year," and "the average number of children per woman dropped from 1.3 in 2017 to a record low of 0.9 last year." China is now a middle-income country with a current per capita income at $12,500, one-fifth that of the US, wrote Ruchir Sharma. "The original Asian miracles, Japan, South Korea and Taiwan, had positive population growth at China's stage of development. Only two (Lithuania and Latvia) had a shrinking workforce." "Before the 2008 crisis, China's debts held steady at around 150% of GDP," but now "Total debt is up to 275% of GDP, and much of it funded investment in the property bubble, where all too much of it went to waste." "Country Garden, a Chinese real estate giant, has lost billions of dollars and racked up $200 billion in unpaid bills. It's on the hook to deliver, by one estimate, nearly 1 million apartments across hundreds of cities in China." ET. "A default by Country Garden would be the latest in a string of collapses in the housing market," and has led to worries that it will end up like China Evergrande which collapsed in 2021. In addition, "Zhongrong International Trust Co, which traditionally had sizable real estate exposure, missed payments on dozens of investment products since late last month, a senior officer told angry investors." Reuters. "China's $3 trillion shadow banking sector is roughly the size of Britain's economy, and concerns about its outsized exposure to property and risks to the wider economy have grown over the past year." "China's major state-owned banks were seen selling US dollars to buy yuan in both onshore and offshore spot foreign exchange markets this week...in an attempt to slow the yuan's depreciation." Reuters. Trouble is, minutes of the Federal Open Market Committee (FOMC) show, "Most participants continued to see significant upside risks to inflation, which could require further tightening of monetary policy." ET. Which means more pressure on the yuan. So bad is the situation that China has stopped releasing the youth unemployment figures. "The age 16 to 24 category has seen unemployment far above the overall jobless rate, reaching a record high of 21.3% in June." CNBC. If the population starts falling who will live in all this real estate? Xi Jinping has to increase pregnancies. Can he?