US fully recovered from Great Depression in 1939, 2 years before entering ww2. Weimar Germany started in 1918 and ended in 1933 at the beginning of nazi Germany, 15 years later.
You can't start a war when you are truly broke, much like China is today. And China is aging super fast, unlike Germany or US during the 30s.
Being in spiraling deflation while the rest of the world suffers from inflation is a big sign of being broke.
Having debt to GDP ratio of 310% and local governments being unable to pay out salaries for many months is a big sign of being broke. (google or chatgpt the salary news, they are everywhere)
Consumer spending dropping 20% y/y in November in Beijing and Shanghai is a sign of being broke.
52,000 EV-related companies shut down in China in 2023 and an increase of 90% on the year before, where most EV companies were the targets of government subsidies, is a sign of being broke.
30% drop in revenues from land sales in 2024, which the local government derive most of its revenue on, is a sign of being broke.
China is not self sufficient; it imports 80% of consumed soybeans and other food products, and 90% of semiconductor equipments. Nor is it even remotely at the same level as Japan when Japan entered the lost decades. 600M Chinese citizens earned less than $100/month as of 2020. Recently, a scholar reported 900M Chinese citizens earned less than $400/month.
> Being in spiraling deflation while the rest of the world suffers from inflation is a big sign of being broke.
How would you handle the eloquent counterargument that spiraling deflation is not a sign of being broke? Deflation doesn't, in and of itself, signal anything except that the real value of a currency is going up.
China is one of the worlds largest creditors [0]. They may have a lot of organisational problems - I'd go as far as saying they are guaranteed to given they are quite authoritarian. But they aren't broke.
None of those metrics signal problems in and of themselves, and when put together ... they still don't. The consumer spending drop is the closest to something that might be a problem but it needs some supporting data to make a case.
Deflation by itself, sure. Deflation when coupled with huge and increasing debt to service, then you have a crippling problem. That means your ability to pay off your debt gets harder and harder as time goes on, and most of your income goes to service debt principal and interest, and not on actual income growth. China plans a record $411 billion special treatment treasury bond next year, for example, but most if not all of that is just helping local governments pay off debts.
China being the largest creditor doesn't mean much when a lot of their debt is issued to belt and road countries that can never be paid back, and will be written off in the future. It does have a large US debt holdings, but that has shrank from 1.27T (2013) to 772B (2024), and a large part of that being used for cross border transactions.
> Deflation when coupled with huge and increasing debt to service, then you have a crippling problem.
Individuals have a problem. Corporations have a problem. China may or may not have a problem. It depends on how reasonable their bankruptcy laws are. Cleaning out the system of people who aren't using capital effectively is a healthy thing to do.
And I have to say, this idea that we should focus on China's debts and dismiss their credits is suspect. I mean sure, if we ignore all the assets and income streams then they do have a problem. But that isn't reasonable. You can't ignore the strengths to make an argument they are weak.
You can't start a war when you are truly broke, much like China is today. And China is aging super fast, unlike Germany or US during the 30s.