Per Capita Spending of 894 Yuan, Not Even Beating Last Year's 911! The Ministry of Culture and Tourism Shrunk the 2019 Baseline by 10%, Ordinary People Repaid 1 Trillion Net in 8 Months, Xiaocaiyuan Got More Customers but Net Profit Dropped 24%, Longnan Spent 72 Yuan to Attract One Visitor but Only Got 1 Yuan in Tax Revenue! Trading Future Cash Flow for a Headcount Right Now

This video analyzes the actual consumption data during the October First Golden Week holiday, pointing out that the Ministry of Culture and Tourism fabricated the illusion of consumption growth by quietly lowering the 2019 baseline. At the same time, it explores the current reality where ordinary people are making net loan repayments, catering merchants are seeing increased customer volume without increased profits, and local governments are spending massive amounts to attract tourists only to reap negligible returns. It points out that the current approach is trading future cash flow for present-day headcounts.

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See the world as it is, reject fragmented understanding. Today, let's take a look at consumption during the October First holiday. In fact, a week before October First, the Ministry of Transport of the CCP made a prediction at a press conference held by the State Council Information Office on September 24, saying that on that single day, cross-regional passenger trips across society would reach 340 million, surpassing the 336 million recorded on October 1 last year. Yet when the actual figure was published on October 2, it was only 329 million trips, down 1.9 percent compared to October 1 last year. That means the forecast predicted a rise, but reality saw a decline. Furthermore, from October 1 to October 5, the actual figures released by the Ministry of Transport every single day were lower than its own projections for that day. During this year's October First holiday, domestic trips stood at 826 million person-trips, with total spending of 738.4 billion yuan. Calculated on a daily average basis, according to CCP official rhetoric, these figures represented increases of 6.3 percent and 4.3 percent respectively compared to last year. But did the spending per person actually go up? The measuring tape is right at hand; we can measure it ourselves. How do we make this measuring tape? It's just a very simple division: divide the total domestic tourism spending by the number of trips, and what you get is how much money each person spent on each trip. During October First in 2023, spending per person-trip was 912 yuan; the year before that, it was 916 yuan per person-trip; this year, it was 911 yuan. Over three years, it has hovered within a fluctuation band of five yuan. After all, this is Emperor You Xi's favorite number. Then the CCP began spouting wild claims, asserting that consumption had already recovered. Let's examine a very entertaining official narrative here. There is a massive trick tucked inside, and this trick traces all the way back to 2019. During the 2019 October First holiday, the announced figures were 782 million person-trips and 649.7 billion yuan in tourism revenue, which, divided out, comes to 831 yuan per trip. Looking at it this way, compared to 2019, last year's 911 yuan would mean it has not merely recovered, but grown. But here comes the trick. In 2024, what did the press release from the Ministry of Culture and Tourism say? It said that trips during October First grew by 10.2 percent compared to the same period in 2019, and spending grew by 7.9 percent. Well, then it's simple: calculate backwards using that 2024 figure of 765 million person-trips, and look, the air leaks completely out of the tire. With that reverse calculation, the 2019 trip count claimed by the Ministry of Culture and Tourism directly shrank to 694 million person-trips, a full drop of more than 10 percent compared to what they themselves announced back then. And here comes the funny part. What does this mean? It means the baseline for 2019 trips underwent an ultra-long-distance seasonal adjustment five years later. This can't even be called a seasonal adjustment; this is a five-year adjustment. What kind of seasonal adjustment is that? Adjusting across five years, huh? They stealthily shrank the baseline out of thin air. How they adjusted it, I couldn't find a single public explanation. Once it's reduced, naturally the recovery rate looks higher.

However, making this change creates a side effect. What side effect? If we still calculate based on the metric of 649.7 billion and 694 million trips, the per capita spending instantly jumps from 831 to 936 yuan. Therefore, according to the Ministry of Culture and Tourism's own figures, across the four National Day holidays from 2023 to this year, not a single year has returned to the 2019 level. So I strongly suspect that this data has now become something where the Chinese Communist Party shoots first and draws the target around the bullet hole, completely losing any reference value. You fucking motherfuckers can stealthily alter the baseline data spanning five years like this; if I hadn't gone back to check past data records, I probably would have believed it. But I know all too well that the Chinese Communist Party cannot possibly be this honest when it comes to data. What kind of trick is the Chinese Communist Party practicing now? Well, it is playing the clever trick of putting sugar on a turd, and that is not even factoring in inflation. From 2019 to this year, the consumer price index for residents has accumulated an increase of nearly 7 percent. So the 936 yuan from 2019, when placed in this year, is actually 1,000 yuan, while last year's 911 yuan, placed in this year, should be 919 yuan. That is the standard calculated using constant prices. Therefore, only if this year's National Day per capita spending exceeded 919 yuan could it be considered spending more money than last year after stripping away inflation. But only by exceeding 1,000 yuan would it truly be considered returning to that 2019 level. So what is the figure we measured? The total spending data provided by the Chinese Communist Party's Ministry of Culture and Tourism itself, as just mentioned, is 649.7 billion divided by 826 million trips, which comes out to only 893.9 yuan per trip, failing to even surpass last year's paper figure of 911 yuan. In other words, it is 1.9 percent less than last year, falling more than 100 yuan short of 1,000 yuan. In fact, this trend was already evident during the three holidays that have already passed this year—Qingming, May Day, and the Dragon Boat Festival. In all of them, the growth rate of travel trips outpaced the growth rate of spending, and year-on-year per capita spending dropped across the board. It is just that this time during National Day, it reverted to this trend: trips increased by 6.3 percent, while spending only grew by 4.3 percent. Such consumption inevitably has inertia. However, the National Day date probably carries some special political significance for the Chinese Communist Party. If people stopped spending money on this date, it would be too humiliating. So they had a sudden brainwave and went back to alter the 2019 data. This combo move would cause Einstein's brain to crash upon seeing it; who said you cannot go back in time? Didn't the Chinese Communist Party pull it off? Let's look at how people traveled. On October 8, the Ministry of Transport gave the total number for the seven days: the cross-regional mobility of personnel across the whole society was 2.142 billion trips, which was slightly more than the 2.13 billion predicted before the holiday. But compared to the daily average of the eight days during last year's National Day, it only grew by 0.6 percent. What grew the most? Railway transport and passenger transport, which grew by 12.7 percent, while long-distance bus traffic grew by 7 percent. Which one dropped? Self-driving trips, while civil aviation passenger traffic basically remained flat over the seven days. So let's focus on this self-driving sector. Self-driving trips already dropped by 0.5 percent during the three days of the Mid-Autumn Festival, dropped directly by 9.7 percent on September 30, and dropped by 1.4 percent over the seven days of National Day—declining in all three periods. Moreover, self-driving accounts for nearly 80 percent of the total personnel mobility in society; if self-driving does not grow, the overall total cannot grow. Why did self-driving drop? My judgment is mainly still the oil prices. China's gasoline prices have accumulated an upward adjustment of over 1,700 yuan per ton since the beginning of this year. The airline ticket sector is also particularly interesting. When airlines posted ticket prices for National Day day before the holiday, the prices were 11 percent higher than last year, but their arrogance didn't even last a day before crashing. By October 2, the average ticket price was nearly 20 percent cheaper than on October 1. The same morning flight from Beijing to Kunming was listed at 1,927 yuan on October 1, and turned into 884 yuan on October 2, getting slashed in half in just one day. Calculated over seven days, the average domestic economy class price provided by Flight 管家 (Flight Master) was around 931 yuan, but it was still nearly 9.5 percent more expensive than last year. The direct result was that the number of people taking airplanes did not increase, and the extra citizens all went to take trains and buses.

So good people went out, but where was the money spent? Let’s first look at where the big money went. The largest expenditure for a family is buying a home. The property market numbers during this year's National Day Golden Week are somewhat intriguing. These are data from the China Index Academy itself. From October 1 to 7, new residential property transactions across 25 key cities totaled 551,000 square meters, with the average daily transaction area rising by 33.8% compared to last year's National Day holiday. The average daily number of second-hand home transactions across 11 key cities rose by 42.8% year-on-year. But there is a second half to this data: new home sales were basically flat compared to the National Day holiday two years ago, while second-hand home sales were far behind the same period two years ago. What is this related to? Think about it, when was the fiscal interest subsidy policy rolled out? It was announced on September 29 and took effect on October 1. I really cannot understand how anyone could penny-pinch like this—dropping the watermelon to pick up sesame seeds. Moreover, subsidies were only one side of the coin. At the same time, developers were also slashing prices. In Shenzhen, among the more than 1,200 residential units that entered the market around the end of September, tiered discounts were widespread, generally hovering around 15% off. Let’s look at the differences: where was the biggest increase? In Beijing, the average daily online-signed transactions for new commercial residences over these few days were 144 units, a 176% jump year-on-year, and most of what sold well were upgraded properties along subway lines, while properties in far outer suburbs continued to cut prices without much volume. In Shenzhen and Chengdu, online registrations simply fell. Looking nationwide, the sales area of new homes across 100 cities tracked by the China Index Academy still fell by 5% year-on-year in September this year. In October, it will probably produce a data pattern similar to the CCP's consumer subsidy push—surging to a spike and then steadily declining. Therefore, regarding this 30% jump in sales volume, my assessment is that a low baseline combined with fiscal interest subsidies, plus developer discounts, concentrated solely on key cities, and amplified by CCP state media fucking promoting sales like crazy, produced this effect. Down the road, the trajectory will likely mirror the consumer subsidy curve: lasting at most three to five months before fizzling out. During this period, everyone will surely see the CCP talking bullshit everywhere again, claiming the real estate market is warming up. Remember, this is the result of a low base coupled with the newly released marginal subsidies taking effect; the property market has not truly recovered. Everyone must stay clear-headed on this point. Now look at small-ticket spending. First, let’s talk about movies. The average price of a movie ticket this year was only 36.4 yuan, cheap enough, right? Over the seven days of this year's National Day holiday slot, total box office revenue was only 1.165 billion yuan. Last year’s eight-day holiday saw over 1.8 billion, the seven days two years ago took in 2.1 billion, and those seven days in 2019 reached nearly 4.5 billion. Ticket prices didn't go up at all, but rather dropped. Yet people simply stopped watching movies. So what actually went up? Local city travel numbers, especially travel products in county towns, which jumped by 42%. But once people arrived at scenic spots—taking 16 5A-level scenic spots in Shandong as an example—visitor numbers rose by 15.35% over the seven-day National Day holiday, while operating revenue grew by only 10.3%. Next to Beijing, there is Gubei Water Town, where the data is even more surreal: in the first half of this year, passenger flow increased by 27%, but operating revenue actually fell by 9%. That is the reality. Why can't the spending keep up? It comes back to the same point: the single biggest factor driving China's economy forward is the leverage ratio. As we have mentioned many times before, from January to August this year, household loans saw a net decrease of 1.03 trillion yuan. Across the country, people have collectively been net repaying debts in recent months. Under such circumstances, it is extremely difficult for consumption to pick up.

Let's look at saving money again. I ran the numbers using the resident income and expenditure data from the CCP's National Bureau of Statistics: for every 100 yuan earned, the portion saved was 34.5 yuan in the first half of last year, and in the first half of this year it formed a neat symmetry at 35.4 yuan. What's even harsher is the incremental part: in the first half of last year, for every extra 100 yuan ordinary people earned, they spent 64 yuan more; this year, nicely enough, it is also very symmetrical—in the first half of this year, for every extra 100 yuan earned, they only spent 40-some yuan more. How much money a person dares to spend depends not on how much wages they received this month, but on an estimate of how much financial cushion they have for the days ahead. In economics, this is called the permanent income hypothesis. As for assets, the two biggest pillars of household wealth—housing and stocks—are both falling. This is data from the CCP's National Bureau of Statistics on 70 large and medium-sized cities: in August this year, second-hand housing prices fell year-on-year by 2.7% in first-tier cities, 4.9% in second-tier cities, and 5.6% in third-tier cities. The transaction volume during this round of the October 1st Golden Week was driven by discounts plus interest subsidies, but the prices certainly won't look good, because developers are all slashing prices. In the stock market, the Shanghai Composite Index fell by 6% in the third quarter of this year, and the ChiNext Index plunged by 27.8% in just one quarter. And then inside the Great Firewall, the comment sections of stock bloggers became fucking spotless again. Nowadays, whenever the A-share market drops, the comment sections of these stock bloggers are cleared out. What's the deal? This time it's not hostile foreign forces maliciously shorting the market, so it became the comment sections' fault? The name 'A-shares' is truly vivid! Indeed, people might pick the wrong given name, but never the wrong nickname. Isn't this just a scam where ordinary people get taken for a ride together? How vivid! Look at January and March of this year, the number of newly opened accounts on the Shanghai Stock Exchange was nearly 9 million. Before they even enjoyed a few good days, they took a sucker punch right before the holiday. Under such circumstances, who dares to spend money? Alright then, people show up, but their money can't keep up. What does it feel like for the merchants who serve them? Let's first look at the cloud of sorrow hanging over the merchants' heads. On July 25 of this year, the CCP's State Administration for Market Regulation slapped Ctrip with a massive fine, ruling that Ctrip abused its dominant market position in online hotel bookings, confiscating 1.658 billion yuan in illegal gains and additionally fining it 3.521 billion yuan, totaling 5.179 billion yuan—roughly 5.2 billion. How much commission did Ctrip take? Before rectification, the base commission for hotels was divided into three tiers: 10%, 12%, and 15%. There was a report in the China Youth Daily in January this year—what did it say? It said that according to the Yunnan Tourism and Homestay Industry Association, for some homestays, when factoring in various promotion fees, the comprehensive cost approached nearly 40%. The same report interviewed a homestay owner who said that out of the 239 yuan paid by a guest, only 176 yuan reached his hands, with the platform alone pocketing 26%. After the rectification, the Economic Daily claimed that the highest tier was generally reduced to around 10%, but they didn't provide a single sample. Oh, right, there's another detail everyone should savor: the 5.2 billion yuan fine went right into the CCP's pockets, but the amount ordered to be refunded to merchants was only 122-odd million yuan. What the platform gouged from the merchants was taken away from the platform by state coffers, while what the merchants got back was an amount that doesn't even amount to loose change.

Look at how the Chinese Communist Party (CCP) plays its games: same old trick, pouring the soup into a new bowl to trap you. Fine, you penalize Trip.com, okay? Did you return those monopoly profits to the merchants? Nope, the state took the money for itself. On top of that, it pocketed a massive 3.5 billion fine all for itself. One end of the stick is squeezed to the limit, while the other end doesn't dare to raise prices. Let us take a small restaurant near a scenic spot as an example. This is an estimate I made based on the cost structure of a listed catering company and the China Hotel Association; it is not the actual ledger of any specific store. The numbers work out like this: suppose a restaurant normally has a daily revenue of 6000 yuan. According to the cost structure, food ingredients account for 34 percent, labor accounts for 30 percent, rent takes up about 10 percent, and utilities plus platform commission, depreciation, and taxes together account for 18 percent. Once you calculate all that, out of 6000 yuan in daily business revenue, the actual amount that ends up in your pocket is only 480 yuan. For the first three days of the National Day holiday, let us assume the number of customers increased by 60 percent. However, a huge portion of current customers buy group-buying set meals online. Under this circumstance, the revenue per customer drops by 10 percent. What is the total revenue then? You can figure it out in your head: 6000 multiplied by 1.6, then multiplied by 0.9, equals 8640 yuan—an increase of 44 percent. As for the costs, ingredient costs jump to 3264 yuan. Labor costs during holidays must go up by at least 50 percent, meaning 2700 yuan. Rent stays the same at 6000 yuan... wait, 600 yuan. If online group-buying orders account for half of the total, then the group-buying commission and traffic fees directly jump from 5 percent of revenue to 9 percent, which is 778 yuan. Add utilities, depreciation, and taxes, and when you calculate it all, the money left in your pocket for the day is a mere 396 yuan. Many friends were curious before: how does this inversion between revenue and profit happen? This is exactly how it happens. Even though revenue increased by 44 percent, profit dropped by a full 17 percent. After looking at this cost structure, you will notice a key issue: whether it is price concessions, increased labor costs, or higher commissions, as long as any one of these three things is missing, this restaurant could have made more money during the National Day holiday. But these three areas have basically been calculated to the extreme by the platforms. When the per-customer discount hits 9 percent or the commission exceeds 8 percent, taking on these extra 60 percent of customers is tantamount to working for nothing. If you strictly follow the labor law to pay employees triple wages, those three days would turn into a daily net loss of 2300 yuan. There are also ready-made examples among listed companies. There is a company called Xiaocaiyuan, a catering enterprise. In the first half of this year, their return-customer rate rose from 3.1 to 3.5. They indeed had more customers, but average spending per person dropped from 57 yuan to 50.5 yuan, and net profit plunged directly by 24 percent. So even though the tail seems to have only been clipped by a few yuan, when reflected on the income statement, what gets chopped off is a massive chunk of profit. And what has truly collapsed is automobile consumption. Let us look at retail sales of automobiles. When subsidies were ramped up from September 2024 to September of last year, the year-on-year figures for the months with available data showed the lowest drop was 4.4 percent and the highest growth was 6.6 percent. Cars indeed sold more last year and the year before—these are data from the China Passenger Car Association. Total retail sales for last year only grew by 3.8 percent, but prices were plummeting off a cliff. Retail revenue simply could not rise and prices were still being driven down. The inventory piled up by wholesalers was utterly disastrous. Therefore, in the twelve months from last October to this December, automobile retail sales dropped year-on-year in ten of those months, and after entering this year, the downward trend noticeably accelerated. By this August, it directly blasted out a deep crater of an 18.5 percent drop, nearly 24 percent lower than August 2023, which had no EV subsidies. Remember this: the curve for automobiles is the sales curve for housing. From January to August this year, cars participating in the trade-in program sold an average of only 670,000 units per month, a full 30 percent fewer than the monthly average of 960,000 units last year. To make matters worse, the European Union started ramping up tariffs on Chinese automobiles. Was that money spent worth it? Haven't the CCP spent the last two years running a 300 billion fiscal subsidy for consumption? What did the CCP say last year? They claimed that last year's 300 billion drove 2.61 trillion in sales revenue. Divide that by 300 billion, and they claimed that every single yuan drove 8.70 yuan in consumption. This is absolute bullshit. It is like saying my mom's monthly grocery budget is 2000 yuan, and then I hand my mom 100 yuan and claim that every single yuan I gave her leveraged 20 yuan in groceries. Isn't that fucking nonsense? What, if I didn't give my mom this 100 yuan, my family would just stop eating and drinking altogether? And sure enough, right after the Ministry of Finance finished boasting, the Ministry of Commerce turned around and debunked the Ministry of Finance, stating what? They said the trade-in program drove only a 1 percent increase in total retail sales of consumer goods from January to October last year. So what does a 1 percent increase equal? Around 440 billion. Divide that by 300 billion, and it means one yuan drove 1.50 yuan. That huge gap between 8.70 yuan and 1.50 yuan represents the group of people who would have bought anyway even without subsidies. That is how it works. This year's narrative is practically identical, just even more fucking exaggerated.

Regarding the claim that the 310 million in consumption subsidies during the National Day holiday started to show effect, you had 800 million passenger trips, so let me ask one thing: is this 310 million enough for those 800 million people to each have a sip of porridge? How the fuck did you show any effect? You are truly fucking shameless! Fuck, at least you had 300 billion last year, and this year you dare to brag like this over a fucking 310 million.

Speaking of local governments, there were all sorts of flashy tricks played during the National Day holiday this year. For example, Fuzhou made its entire subway network and bus lines charging under two yuan completely free, while places like Changzhi in Shanxi waived the primary admission fees for tourist attractions. How much did all this cost? I couldn't find the data for a single locality, but the figures I could find were about subsidies. According to a tourism attraction plan for Longnan, Jiangxi, cited by media, a total of over ninety billion was allocated for annual tourist attraction subsidies. What was the goal? To attract one hundred twenty-five thousand overnight group tourists, which breaks down to seventy-two yuan subsidized per person, plus another six million in inclusive subsidies, working out to forty-eight yuan per person. Nowadays, traffic acquisition costs are extremely high, so how much tax revenue can a single tourist actually leave behind for a county? Let us see whether this business deal is even worth making. We can make a rough estimation: suppose an overnight tourist spends five hundred yuan in the county, most of which probably goes to individual businesses and small shops. According to the policy thresholds I am familiar with, monthly sales under one hundred thousand yuan are exempt from value-added tax (VAT), and the portion exceeding that is taxed at one percent. Five hundred yuan would generate at most five yuan in VAT, and half of this five yuan must be taken by the central government first, leaving only the remainder to be split among provincial, municipal, and county levels. What actually ends up in the county's hands is around one yuan. Even if the entire five hundred yuan were spent on large, regularly taxed enterprises, the county would only net about four yuan or so. Look at that—you collect between one to four yuan, but you shell out seventy-two yuan. And this is just the ledger for a single county like Longnan, while subsidy standards across various localities range anywhere from fifteen to five hundred yuan per person. Well, you've spent the money, and you can't collect the tax, but interest payments cannot be delayed for even a single day. By the end of August this year, the average interest rate on the stock of local government special-purpose bonds was 2.7 percent. In other words, borrowing one hundred million yuan means an annual interest payment of 2.7 million yuan. Meanwhile, the average revenue collected from each tourist by A-rated scenic spots nationwide last year was only around seventy-four yuan. This means it would take over thirty-six thousand tourists spending money at a scenic spot—with every single penny kept—just to pay the interest on that one hundred million yuan. And that is without even counting the principal and operational costs! Furthermore, in last year's annual audit report, the National Audit Office vaguely stated that seventeen counties had packaged sixty-five projects whose returns utterly failed to cover their financing costs into supposedly income-balanced projects. Out of such garbage projects, the CCP's own official statistics show that a staggering 12.174 billion yuan in special-purpose bonds was forcibly funneled into them. The returns after completion simply cannot cover costs, so how is the principal primarily repaid? By rolling over old debts with new loans. Local projects are completely unable to break even. Take Dayong Ancient City in Zhangjiajie, for instance: it invested roughly 2.4 billion yuan, yet its operating revenue for the entire last year was a mere 5.02 million yuan. From January to August this year, the interest paid solely on local government bonds reached 1.106 trillion yuan. However, there are places that don't lose money. What kind of places are those? They are old, famous, and traditional scenic spots that basically don't borrow money, like Mount Huang or Lijiang—they actually turn a profit. The ones losing money are almost uniformly all those newly built, debt-financed pieces of crap.

Now, if you string these pieces together and look at the big picture, the common people have been net-repaying over a trillion yuan in debt since the beginning of this year. Housing prices are falling, and the stock market has people trapped. Even though people went out during the holiday, their consumption principle has been to save every possible penny. When ordinary people refuse to spend, merchants cannot raise prices. There are 10 percent more hotels than there were in 2019, yet labor, rent, and interest costs remain exactly the same—not a single penny less. Moreover, for orders coming through online platforms, the platforms skim off more than what the merchants manage to keep for themselves. Following our very conservative deduction from earlier, the extra crowds merely translated into extra workload, not extra profit. With merchants earning slimmer margins, tax revenues naturally cannot be collected. Based on Longnan's ledger, leaving just one to four yuan per tourist in the county is completely spending money just to put on a show and shout slogans, and the cost of doing so is by no means low. You say you are spending seventy-two yuan just to buy a head count, and this is certainly not an isolated case. Right now, local governments across the country have a statutory debt scale alone of sixty trillion yuan, not even counting local government financing vehicles (LGFVs). The interest on the statutory debt portion alone requires around 1.6 trillion yuan a year. Fundamentally, they are all doing the same thing: trading future cash flow for present head counts. You can orchestrate head counts, you can arrange adjusted workdays, you can arrange free admissions, and you can even arrange subsidies. But cash flow? That cannot be arranged. If you want cash flow, what do you need? You need ordinary people who dare to borrow money, merchants who actually turn a profit, and government finances caught in a virtuous cycle. Yet all three of these are currently in drastic contraction. Therefore, after the figures from the Ministry of Culture and Tourism came out, no matter how lively the headlines looked, let's measure everything with today's yardstick. Per capita spending was eight hundred ninety-four yuan—it didn't even reach nine hundred nineteen, failing to surpass even last year's nine hundred eleven. This is the naked truth of consumption in China today.