China Faces Massive Wealth Plunder, 30M Middle Class Wiped Out, Assets Reset to Zero Overnight

What is the real situation at work right now? In our area, in county-level public institutions, performance bonuses have not been paid for several months. Only basic salaries are being paid. For civil servants, even a few months ago, they were only just managing to pay basic wages. I heard that this month, there may not even be enough money left to pay salaries. This is what government workplaces are like now. As for me, I work in a state-owned enterprise, and I haven't been paid for two months. This is the current environment. I just want to say, especially for women, we really shouldn't keep shopping all the time. We should stop for a while and try to save money. In traditional perceptions of Chinese society, civil servants and employees of public institutions have long been viewed as holders of a stable iron rice bowl, a metaphor for basic middle-class security. But because of an ongoing economic slowdown, a struggling real estate sector, high local government debt, and declining tax revenues, even this group is now facing layoffs, pay cuts, and delayed wages. The so-called iron rice bowl is becoming less secure. This suggests that fiscal pressure at the local level is spreading into core parts of society. Do you know who the most unlucky group in China is right now? It's those people living in luxury-looking homes and driving cars worth 500 to 600,000 yuan, but still under extreme pressure. Because everything was bought on loans, now the crisis has hit their income. Everyone's mortgage and car loans becomes like a sharp knife, slowly cutting into them. It's really frightening. The speed at which middle-class families are collapsing is accelerating at an unprecedented way. In the past two years, the most anxious and hardest-hit group has been the middle class. As long as you have money, no matter which social level you are in, there is always a match tailored for you. In Shanghai now, many middle-class people have already fallen into the new poor. People carrying branded bags in subways and office buildings have basically disappeared. Many people have observed that a growing number of once-stable middle-class families are now slipping back into financial difficulties, with living standards declining noticeably. How a fake middle class lost 5 million yuan. And yes, that fake middle class is me. It happened in three steps. First, buying a house. We bought at the second peak around 2017. Then in 2023, we bought another two-bedroom unit in the same community for my parents. Now, by a conservative estimate, prices have dropped by more than 30%, which means several million yuan is gone. Second, investments. I first bought a financial product linked to HNA with a 90-day lock-up period. Two weeks before maturity, it defaulted. And I lost everything. Later, a relative recommended trust products, saying they were very stable. I thought trusts were safe because of the high entry threshold, so I followed and invested. And it also defaulted. Third, career changes and income decline. Because the entire industry was struggling, our company faced layoffs and salary cuts. I was lucky to keep my job, but my salary was reduced. On a positive note, I managed to avoid the quit job, start business, or divorce trap. As someone with a computer science degree from a top 985 university, how do I end up here? I started businesses, worked at major tech companies, and married a high-level achieving wife. High-educated, high-income, and good-looking. We even bought a home in Beijing. Yet suddenly I ended up unemployed, divorced, and returned to my hometown as a defeated middle-aged man. I kept asking myself what went wrong. The problem was the word fake. Fake middle class. Fake strength. I should not have overestimated my ability and bought a house. I truly believed we were already middle class and that buying a home would not be a burden. Our combined housing fund contributions were over 16,000 yuan per month, which roughly matched the mortgage. So I borrowed over 800,000 yuan from friends to raise a down payment for over 2 million yuan and bought a 5 million yuan home. At the time, I felt extremely proud as if I cannot withstand any risk. To put it simply, those of us who studied hard and moved from small towns to big cities easily lose our sense of position. We think we belong in the middle class just because we have a good job and a mortgage. But in reality, we have not reached that stage. In the video comment sections, some viewers expressed sympathy for the creator and left messages such as, China does not really have a middle class. The so-called middle class is just slightly larger leaks. Leaks is Chinese slang for people who are repeatedly exploited financially. The truly wealthy have already moved their assets out. Those still considered rich in China are mostly, like a creator, highly leveraged and only wealthy on paper. Wealth from the middle class helps maintain overall social stability, while resources remain concentrated at the top. From this view, the middle class is under long-term structural pressure and faces ongoing financial decline. The pace of middle class wealth decline is accelerating. In the past, people joked about a three-piece set for financial collapse. One, a multi-million yuan mortgage. Two, one spouse quitting work. And three, heavy spending on international schools for children. But the reality is more severe. Recent analysis suggests this pressure pattern has expanded into a seven-piece set. This includes blind entrepreneurship, heavy mortgage debt, one spouse becoming a full-time caregiver, intensive education pressure on children, speculative investment, neglect of health, and status-driven consumption. Among these factors, entrepreneurship is often seen as the fastest route into financial decline. Two supply chain businesses and a jade processing factory. I own two houses and two cars. Now I am bankrupt in debt and listed as a defaulter with over 1.8 million yuan in liabilities. I do not accept being called a defaulter because I never said I would not repay my debts. And I never expected to end up like this. My wife has also divorced me. Right now, I do not even have 50 yuan to my name. When I'm hungry, I cannot afford food and eat cold steamed buns. When I'm thirsty, I drink tap water from public toilets. I even pick up bottles from garbage bins. I have accepted all of this. Today, my father called me. He said my grandfather is seriously ill with lung cancer that has spread to his brain. He has been in hospital for months. My father asked if I could come back to see him because the doctor said it is critical and the death warning has already been issued. My father said my grandfather looks at my photo every day and keeps asking about me. He said I should come back because every meeting could be the last. When I heard this, I could not stop crying. I have failed so badly that I cannot even afford a 398 yuan train ticket to go home and see my dying grandfather. In a slowing economy, middle-class households are especially vulnerable. Compared with lower-income groups, they often carry higher debt and more complex assets. As a result, failed businesses or investment losses can quickly weaken their financial position, pushing them from middle-class status into serious debt. Some households, due to high spending habits and limited savings, fall into financial stress soon after income distribution. It is estimated that by this year, more than 30 million middle-class families in China may face the risk of downward mobility, with about one in four potentially affected. At a deeper level, some argue that policy priorities have not focused on the long-term stability of the middle class. Instead, through financial constraints, indirect taxation and resource allocation, wealth continues to concentrate upward and towards institutional channels. Events such as stock market volatility, failed wealth management products, and the collapse of peer-to-peer lending have repeatedly reduced middle-class financial assets. A widely circulated China Wealth Report 2025 by China International Capital Corporation estimates that China's total household wealth is 790 trillion yuan, with 360 trillion held by the state and 430 trillion held by individuals. The wealthy class is 0.33% of the population, and it holds 67% of total wealth. This equals about 4.6 million people, controlling 290 trillion yuan, with an average of 63 million yuan per person. The middle class makes up 7.05% of the population and holds 26% of total wealth. This equals about 93 million people controlling 110 trillion yuan, with an average of 1.1 million yuan per person. The general population makes up 92.7% of the population and holds 7% of total wealth. This equals about 1.3 billion people controlling 30 trillion yuan, with an average of 23,000 yuan per person. This wide wealth gap has triggered extensive public discussion. Some see these figures as contradicting the official narrative of common prosperity, and they highlight the reality that many people have struggled for decades without moving out of low-income conditions. China's middle class is smaller than commonly assumed. The often cited figure of 400 million members of the middle class appears inconsistent with these estimates. The stable core middle class, those with steady wage income who can withstand asset fluctuations, may number only in the millions, while many others are considered pseudo-middle class, built on leverage and fragile financial positions. In recent years, terms such as disappearing middle class, downward mobility, and middle class decline have been widely discussed in China. This reflects not only public perception, but also a broader economic reality taking shape. A recent Chinese media report about a family earning 1 million yuan a year suddenly falling into financial distress sparked discussion online before being removed. The article stated, in Shanghai's Lujiazui district, Zhang Ming and his wife were once regarded as a model middle class family. He worked as a middle-level manager at a tech company, and she was a marketing director at a foreign firm. Their combined annual income exceeded 1 million yuan. They owned a million-yuan apartment in Pudong, and their daughter attended a well-known international school with an annual tuition of nearly 300,000 yuan. On weekends, they often drove their BMW X5s to high-end malls and restaurants. Their life appeared stable and successful. But everything came crashing down when Zhang Ming turned 45. His company underwent large-scale layoffs because of industry restructuring, and his entire department was eliminated. At the same time, his wife was diagnosed with a condition requiring immediate complex surgery. Medical costs were estimated at over 500,000 yuan. To make matters worse, their daughter's school bills were due. Within just one month, this once highly successful middle-class family was pushed into an unprecedented financial crisis. What's striking is that although Zhang Ming's family owned property worth nearly 10 million yuan, they had too little cash to cover next month's mortgage payments and medical costs. When they tried to sell the property to raise funds, they found that similar homes had been listed for an average of six months without buyers. Even after price cuts, it would still take several months to complete a sale. A family with millions in assets was unable to withstand even short-term financial pressure. Zhang Ming's case is not unique. Over the past decade, real estate has become the main store for wealth for Chinese households. A 2025 central bank report shows that 59% of household wealth is held in property, highlighting both its importance and its risk. This concentration is closely tied to policy and financial structure. Local governments rely on land sales for revenue, banks rely on property as collateral, and households are encouraged to take on leverage to buy homes. Rising prices once created the appearance of growing wealth as property gains often exceeded wages and supported consumption and borrowing. However, this cycle depended on continuously rising prices. When the property bubble bursts, the risks fall mainly on households. Mortgage pressure, unfinished housing projects, and falling asset values have placed many families under financial strain. At the same time, many analysts expect housing prices to remain under pressure due to long-term population decline. Over the next 10 to 15 years, property in many regions may lose liquidity. As former Northeast Securities Chief Economist Fu Peng has said, some assets may have no value. And Jack Ma has also been quoted saying housing prices are as cheap as spring onions. Even after prices fall, housing is not cost-free. Homes still require maintenance and repairs. Without upkeep, they become unlivable. This creates a liquidity trap where assets lose value but still generate ongoing costs, including maintenance fees and property management charges. China's middle class is shrinking, and this trend is expected to continue for decades. China is also facing rising unemployment pressure. Millions of unemployed college graduates lack stable skills or income and rely on temporary work, increasing the risk of long-term downward mobility. Beyond housing, financial decline can also be driven by aging, illness, and loss of working ability, which can quickly push households into financial distress. Many Chinese households save heavily because of limited social safety nets and high uncertainty about the future. Retirement security remains uncertain. Medical care and elderly care are becoming more expensive, especially for long-term care in cases of disability or cognitive decline. Coverage of some medicines has declined. In many cases, relying on an only child for care is unrealistic, making paid caregiving necessary and expensive. Employment prospects for the next generation are also uncertain. Education requires significant investment but does not guarantee stable or high-paying jobs. Many graduates face unemployment after graduation or later in life, making financial buffers necessary. In addition, asset prices remain under pressure due to population decline, aging, housing oversupply, construction quality issues, and structural liquidity constraints. These all contribute to continued downward pressure on housing prices. In an environment of weak income growth and volatile asset prices, households tend to save more and reduce consumption. This contributes to deflationary pressure driven by weak demand, falling corporate profits, and worsening employment conditions, creating a self-reinforcing cycle. Japanese scholar Kenichi Ohmai, in his M-Shaped Society, warned that when mortgage pressure is high, marriage and childbirth decline, and education costs rise, the so-called middle class becomes an illusion. This description is often seen as relevant to China today. An M-shaped society refers to a hollowed middle with growing inequality. The top accumulates resources, the bottom faces limited protection, and the middle gradually declines. The traditional bell curve structure breaks down, weakening consumption and increasing inequality risks. Economic growth alongside middle class contraction reflects a structural imbalance in wealth distribution. In this context, China's middle class sits between wealth and poverty, increasingly squeezed and gradually moving downward. It has also become one of the most anxious and insecure social groups.