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        <title>Top China execs forecast more deflation and falling profits ahead.  And that's the plan.</title>
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        <description>C-suite executives across Chinese industry anticipate falling input prices as lower costs for raw materials and logistics drive efficiencies. The Cheung Kong School of Business publishes proprietary surveys of hundreds of top business managers across China, and companies report chronic falls in prices for raw and intermediate goods. But they also report difficulty in passing through these savings to bottom-line profits; consumer prices are also falling, relentlessly, economy wide. In Western economies, deflation is a signal of collapsing economic activity, and even depressions. But Chinese deflation is a result of powerful supply-side forces that have the opposite effect:  China's economy continues to grow at solid rates, while rent-seeking profits are extinguished at the company level by high competition. Closing scene, Shexian, Anhui Cheung Kong School of Business Chinese:  https://www.ckgsb.edu.cn/ English:  https://english.ckgsb.edu.cn/ The CKGSB Business Conditions Index Chart https://english.ckgsb.edu.cn/knowledge/business-conditions-index/ Substack, China’s Deflation Isn’t a Crisis — It’s the Price of Industrial Success https://ceinewsletter.substack.com/p/chinas-deflation-isnt-a-crisis-its?r=1hm987&amp;utm_medium=ios&amp;triedRedirect=true CNBC,  China’s property slump is far from bottoming. But Beijing is prioritizing tech growth https://www.cnbc.com/2025/10/23/chinas-property-slump-is-far-from-bottoming-but-beijing-is-prioritizing-tech-growth.html NPR, Electric car makers in China are slashing prices in an effort to boost sales https://www.npr.org/2025/06/30/nx-s1-5440153/electric-car-makers-in-china-are-slashing-prices-in-an-effort-to-boost-sales China's Industry Becoming Increasingly Stronger Globally Thanks to Falling Electricity Prices https://www.all-about-industries.com/falling-electricity-prices-china-global-competitiveness-a-678fbe59c8e3bc41253d03df59f66263/ Part 2: Good and Bad Deflation–The Great Depression https://medium.datadriveninvestor.com/part-2-good-and-bad-deflation-the-great-depression-40e373102a62 How Government Failure Caused the Great Recession https://www.aei.org/articles/how-government-failure-caused-the-great-recession/</description>
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