It found that Chinese median wealth per adult, at $26,752, now outstrips Europe, where the average adult has a wealth of $26,690. The European figure takes into account the whole of the continent, which includes many less wealthy nations in its southern and eastern regions.
That’s right, China per capita wealth outpaced European per capita wealth last year by a whopping $62.
In China, owning a home is synonymous with “security for retirement,” says Iris Pang, chief China economist at Dutch bank ING. And for years, real estate was a reliable investment strategy. Home prices in China have skyrocketed in the past two decades.
Unfortunately, real estate prices—particularly residential real estate prices—are falling rather precipitously, after softening for several years now.
That $62 per capita wealth margin China presumably enjoyed over Europe in 2021 amounts to 0.23% of China’s per capita wealth. It amounts to 0.33% of the 70% portion of that wealth presumably tied up in real estate.
Real estate prices in China declined 1.3% year on year in August alone. Which means market valuations on real estate have dropped by 1.3% in August alone. Which means China’s housing/banking/economic crisis has already erased whatever wealth advantage China might have accrued over Europe last year.
But instead of factoring current economic data, corporate media simply trotted out stale numbers and said “the average Chinese is wealthier than the average European”.
Perhaps that was true last year. It is highly unlikely to still be true today.
What The Corporate Media Still Does Not Understand--China's Economy Is Imploding
Corporate media never misses an opportunity to miss an opportunity.
On paper, according to Credit Suisse’ 2022 Global Wealth Report, the average Chinese citizen is wealthier than the average Eurozone resident.
That’s right, China per capita wealth outpaced European per capita wealth last year by a whopping $62.
Except
70% of that wealth is tied up in real estate.
Unfortunately, real estate prices—particularly residential real estate prices—are falling rather precipitously, after softening for several years now.
That $62 per capita wealth margin China presumably enjoyed over Europe in 2021 amounts to 0.23% of China’s per capita wealth. It amounts to 0.33% of the 70% portion of that wealth presumably tied up in real estate.
Real estate prices in China declined 1.3% year on year in August alone. Which means market valuations on real estate have dropped by 1.3% in August alone. Which means China’s housing/banking/economic crisis has already erased whatever wealth advantage China might have accrued over Europe last year.
But instead of factoring current economic data, corporate media simply trotted out stale numbers and said “the average Chinese is wealthier than the average European”.
Perhaps that was true last year. It is highly unlikely to still be true today.