Recently, the National Bureau of Statistics released the CPI and PPI data, and on the surface, it looks pretty normal: CPI is up 1% year-on-year, which counts as mild inflation, while PPI, influenced by international raw material prices, is up 4.1%. But if you put the data together, you’ll see the problem PPI can be thought of as the price of flour, and CPI as the price of bread. In the U.S., when the price of flour goes up, the price of bread follows. But here in China, no matter how much the price of flour rises, the price of bread doesn’t budge. The reason? People in China only have so much money left to spend