It is about choosing the right way at the cost of short to medium term pain, or the easy way like the US did with its quantitative easing. In 2008, China did the right thing by launching massive high speed rail projects to get China out from the global financial meltdwon. China literally using the crisis to upgrade the transportation infrastructure. But China also did let the property bubble ballooned. I didn't say it is wrong choice, after all the meltdown came so sudden, and they needed to act fast.

This time, Xi chose the right way, even though it will be painful in the short to medium term. He has no choice. The US is hell bent on destablizing the relationship, it become unreliable economic partner. Business as usual is not an option anymore. This property mess will not be sorted out in a matter of a year or two, I suspect it will take at least 10 years. Property market will be back, when the current inventory is cleared, people still need housing.

Upgrading the infrastructure to suit the new industrial revolution like what Andy Xie recommended is also a smart decision. Transitioning to renewable energy and EVs not only save China new industry while they are being blocked from the western market, but in the long term, it will also reduce China dependence on energy import, the saving will be enormous and China national security will also benefit from it.

One thing China must ensure is to make sure the average Chinese citizens to get their share of the pie. That means, China need to ensure their income to keep rising. Raising minimum wages is probably necessary, even though it will cause more slow down in the short term. Only if the average Chinese have more income, will they feel more confident to spend. Higher wages will also attract world wide talents to China.