We must never again take the people as a price!

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Source: dashuxiangzhang (id:dashuxiangzhang)

A piece of soil, if used for farming, is worthless;

If it is used to build a factory, it is building a nest to attract the Phoenix to lay golden eggs;

If it is used to build a house, it would be better to “build thousands of buildings and shelter the faces of all the poor people in the world”. I am afraid it will become an overwhelming shackle of life.

During the economic downturn, there was a lot of chaos, and real estate was taken out as a nightpot.

Some developers, under the banner of helping farmers, supplemented by the gimmick of “zero down payment”, let the old farmers who ate in the soil make mortgages, sell the houses they smashed to the farmers, take the money from the bank and turn around and run away gracefully.

After this wave of operation, the farmers got houses, the banks issued loans, the government boosted the economy, and the real estate developers got cash. Everyone was happy.

??

Is everyone really happy?

This is the time when the economy is down, and this is the time when residents’ debts are high.

Let’s look at a set of data.

At the end of the first quarter of 2022, the balance of RMB real estate loans was 53.22 trillion yuan, a year-on-year increase of 6%. It doesn’t sound like a big deal, but if you change it into the total number, the per capita and the proportion, you will know.

At the end of the first quarter of 2022, the total debt of Chinese residents exceeded 200trillion, the per capita debt was 147000, and the national savings rate fell from 51.8% to 45%.

What did the common people do when they borrowed so much money?

We all know that, of course, it is to buy a house.

Southwestern University of Finance and economics has continuously investigated 355 cities and more than 40000 households for 8 years, and then released a report according to the survey results, saying that the main body of household debt in China is housing loans, which accounted for 55.6% of household debt from 2013 to 2018.

High housing loans correspond to relatively low incomes.

Qiu Baoxing, Vice Minister of the Ministry of construction, also said publicly that there is no shortage of housing in China, but the ratio of house price to income in some cities has exceeded 20, far higher than the internationally recognized standard.

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It’s not terrible for ordinary people to be in debt when buying a house. What’s terrible is that the debt will be carried for a lifetime, and may even be carried by several generations.

When the economy goes up, people still have hope for the future. If the debt is higher and the days are tighter, at least there is still a future to look forward to. When the economy goes down and the epidemic situation is superimposed?

Therefore, what farmers get seems to be a house but actually a debt, what banks get seems to be an asset but actually a risk, and what the government gets seems to be an economic sacrifice is actually the future. estate agent? I really got the money, but I just lived on.

Will the person who takes the money run away? Dashu doesn’t know, but someone has already done it.

Real estate can no longer be the focus of the economy. We can no longer rely on “land finance” and “land finance” to stimulate the economy.

Some readers will ask, since pushing real estate is so harmful, why did we push it again and again in the past?

This is a good question. To answer this question, we have to go back to history.

China’s economic achievements are obvious to all. The rapid development of decades has been called “China’s economic miracle” by the world.

To develop the economy, we cannot do without the input of labor and capital elements and the improvement of scientific and technological level.

Labor factors? What China needs most is labor.

Scientific and technological level? When we are still in low-end manufacturing, we do not need to consider the technical level. People will move mature and backward technologies in complete sets.

The only factor to consider is capital. Where does capital come from? Either rely on internal accumulation, or rely on foreign investment or foreign debt.

But foreign debts are easy to borrow but hard to repay.

Don’t forget the Latin American debt crisis in the 1980s.

Latin American countries borrowed a large amount of dollars to invest in China at low interest rates, and the investment projects are mainly large-scale public utilities with long cycle and poor liquidity. In the face of high inflation, the United States also chose to raise interest rates to deal with it.

As a result, once the Federal Reserve raised interest rates, the interest rates in the international financial market rose. The rise in interest rates led to a sharp rise in borrowing costs, which also meant a rapid increase in interest expenditure.

Moreover, once the US raised interest rates, the global economy was not good. The exports of Latin American countries also began to decline. The income decreased and the debt cost increased. The interest rate hike triggered the debt crisis in Latin America.

As a warning, we chose internal funds.

After the tax sharing reform in 1994, “land finance” and “land finance” stepped onto the historical stage, and the real estate industry then began to soar all the way.

The greatest use of “land finance” and “land finance” is to capitalize land and use land to leverage a large amount of social funds.

By using the land transfer fees and the urban investment bonds issued by mortgaging the land, the government has accumulated a huge amount of capital. Using land and capital, the government develops industrial parks to promote industrialization; Vigorously develop infrastructure and promote urbanization.

How did the rapid development come from? That’s how it came about. Externally, we have joined the WTO, become a world factory and earn money in the global market; Domestically, we have made massive investment, and domestic cities are changing with each passing day.

??

There is a reason for the construction maniac, but there is no free lunch in the world.

Has the economic miracle come true? Um.

What about the price? It is, of course, borne by the broad masses of the people.

The higher the value of the house property on the land, the higher the value of the land, and the more capital the government can obtain.

However, no matter how high the value of real estate is, there must be a limit, otherwise it will become a mountain that will overwhelm residents and even the economy.

In some statistical caliber, the leverage of Chinese residents has already surpassed that of Japan when the real estate foam burst, and is close to that of the United States before the subprime mortgage crisis.

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And if the foam bursts, its adverse effects may be more serious than we think. Japan’s lost 30 years are the best lesson.

We do not deny its historical achievements, but specific things can only play a specific role in a specific period.

How about building roads? Very good, very good. “If you want to be rich, you should build roads first.”.

However, when the roads in the city are always repaired again and again, and can never be completed, we should be vigilant: is the marginal benefit of these investments to the economy already very small? Does anyone want pork dipped in oil?

Is it good to build new buildings in the city? If it is to increase supply and stabilize housing prices, the people will welcome it. The government has done practical things, and developers can make money with peace of mind.

But now, urban residents have no money and can’t afford to pay back their loans. French auction houses have reached new highs. The last stick of beating the drum and spreading flowers has been put into the hands of farmers with poor information and low education.

The leaders of these localities stimulate the economy for their achievements and future, and develop real estate for the sake of land finance.

But Dashu, what is the purpose of economic development? What is the purpose of getting funds for investment? Is it for the masses or for ourselves?

The economy is not a string of cold figures. The economy is a red day and hope for the future.

What we need is actually very clear: what we want is industrial upgrading, which can help us make money from the external circulation; What we want is money in the hands of the common people. Only the rich people dare to consume, and the internal circulation of the domestic market can really circulate.

The industrial policies of “BOE” and PV in Hefei are all fresh examples. Do you have to take another breath in real estate and land finance?

Stop harbouring illusions about soaring house prices, because soaring house prices will puncture everyone’s dreams for the future.

Those who take the people as a price will eventually pay for themselves.

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