FT News Briefing China’s economy falls into deflation
Aug 10, 2023
Disney's latest quarterly results reveal a slump in its TV and film sectors, while China grapples with deflation, marked by a 0.3% drop in the consumer price index. The U.S. is tightening tech investment rules in China amidst this economic turmoil. Additionally, European countries like Italy are adopting windfall taxes on banks, reflecting growing concerns over banking profits. The podcast also dives into the music industry's negotiations over AI-generated content, balancing innovation with fair compensation for artists.
AI Snips
Chapters
Transcript
Episode notes
Disney's Q2 Performance
- Disney's Q2 revenue fell short of expectations due to declines in TV and movie businesses.
- However, cost-cutting measures are ahead of schedule, and streaming losses have been reduced.
China's Deflation
- China's economy has fallen into deflation, with consumer prices decreasing by 0.3%.
- This is due to weakened trade, a real estate liquidity crisis, and lingering effects of the zero-COVID policy.
Deflationary Spiral
- Deflation can cause a downward spiral where consumers delay purchases, expecting further price drops.
- It also increases the real burden of debt, as debt values remain constant while prices fall.