back to article China’s annual e-tail frenzy broke records – trust us, say government, Alibaba and

Alibaba and have forged a new holiday tradition by discussing anything but the revenue generated by the nation's annual 11.11 "Singles' day" e-tail frenzy. November 11 has long been an unofficial and slightly ironic holiday in China, as the day celebrates single life – in contrast to the many other Chinese festivals …

  1. DS999 Silver badge

    Obviously they don't want to release revenue figures

    Everyone expected they will be significantly lower this year, and the reason is obvious. China's economic growth has slowed down, especially the real estate market where many people were getting rich (on paper at least) and youth unemployment is so high that after it breached 20% they decided to quit reporting it at all.

    I'm guessing the government has issued quiet orders to companies to avoid reporting any news that makes the economic issues look more obvious, they already have enough bad news they can't hide like major companies involved in the housing industry going bankrupt and exports falling by enough that the inflation they were feeling a year ago is threatening to turn into deflation.

    China's problem is that they had a housing bubble like in the US in the 2000s, but instead of having over a decade between that bubble bursting in 2008 and all the covid disruptions, China's bubble burst coincided with covid which could make it one whopper of a problem. An autocracy will avoid the political fights we had in the US, but also makes it easier to take measures that avoid short term pain and kick the can down the road. It isn't yet apparent which route they will be taking.

  2. Lurko

    They've also had many years of poor quality commercial lending, so the banks have a triple whammy - real estate, Covid, and business lending. If we judge by history, the CCP will look for ways of hiding this for as along as possible, but ultimately the banks (mostly state owned?) will need to write off a lot of bad debt. Experience elsewhere is that reduces new lending, raises unemployment, and slows growth. Looking at Greece as a model example of a large scale debt related crisis, China could be looking at five years of negative growth, and then a decade of very slow growth. QE has helped "button up" such crises, and that's the route I'd expect in China, but that was part of Abenomics that failed to return Japan to growth, and QE in the US and Europe seems to have been pure money-printing that put off inflation rather than stopped it. China has of course already tried economic stimulus with its ghost cities, under-used airports and extensive infrastructure projects but they're now part of the problem.

    I also wonder if the autocracy will be able to avoid the fights? Within the party, a crisis they're not in control of will be hugely destabilising, and then the search starts for the guilty.

    1. DS999 Silver badge

      Not sure I'd agree that QE had "put off" inflation. The outbreak of inflation was almost entirely covid related - constant supply chain disruptions combined with changing consumer habits made it difficult for the supply of products people wanted to be available when they wanted them. Lockdowns also reduced expense (no vacations, no eating out, no movies, fewer miles put on car) which even without stimulus increased disposable income for people who remained employed. In the US at least corporations were making record profits as inflation peaked, showing that a lot of them were taking advantage of real inflation in other economic sectors to raise prices.

      The disruption to the way people work, the difference in treatment between "essential" employees who had to come in to their jobs versus those able to work from home, and the reduction in the workforce that resulted especially in certain sectors has given employees more bargaining power for wages which have seen a meaningful increase in real terms for the first time in a long time for those in the bottom half.

      The fact that consumer spending is still at very high levels in the US compared with China where it has decreased in a rather significant way is telling about the difference in the two. Both experienced covid induced inflation, but in China that inflation is already gone and producer prices are now falling - due to that lack of demand not only domestically but due to a rather dramatic drop in exports (for a variety of reasons)

      So while the US is reducing the money supply (the opposite of QE) in addition to increases in interest rates to try to rein in inflation (it is down a lot from the peak but still higher than the Fed's 2% target) China is likely to need to increase their money supply to avoid deflation. The problem is that in order for increases in the money supply to do any good they have to be deployed in the form of loans. That's why QE in the US didn't increase inflation despite dire predictions it would - that excess money wasn't getting translated into loans that went to productive work. It was getting sopped up by Wall Street and inflating the price of assets like stocks, houses and startup companies.

      In China there is no massive financial sector that can sop up an increased money supply, so it will either sit on the sidelines and do nothing to help deflation or it will go to more bad loans. More bad loans are "good" in the short term if they prevent deflation, but obviously makes for bigger pain in the future when the reckoning comes.

  3. Sceptic Tank Silver badge
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    11.11 singles day. Why is it so much fun to ridicule single people? I would so really dearly also like to have someone to love but just have never been good enough for anyone.

    1. A. Coatsworth Silver badge

      As I understand it, the idea behind "singles day" (besides mindless consumerism) was for single people to pamper themselves and be ok with themselves.

      As far as these manufactured holidays go, it doesn't seem like the worst idea possible

      1. Lurko

        Beats Halloween, with all the orange plastic tat, pumpkins and crap. Now there's mindless consumerism dressed up as folklore (although arguably the same can be said of the "traditional Christmas").

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