The sharp drop in assets** will indeed have a negative impact on people's consumer confidence. This is because the wealth of many families and individuals is closely tied to the value of assets, especially major assets such as property, ** and **. If the value of these assets falls significantly, people's sense of wealth will decrease, which in turn will affect their consumption and investment confidence.
This impact is mainly reflected in the following aspects:
Wealth effect: When assets are ***, people's real value of wealth decreases, which causes them to be more inclined to save rather than spend. Because they are worried about the loss of their wealth in the future, they prefer to keep their funds safe.
Confidence setbacks: Successive asset** rebalancing can lead to pessimistic expectations about the future economic situation, which can reduce their willingness to spend and invest. This loss of confidence could trigger broader negative impacts, such as a decline in consumption and reduced investment.
Credit contraction: Assets*** can also lead banks and other financial institutions to be more conservative as they may be exposed to greater risk. In such a situation, it may become more difficult to obtain loans and credit, further dampening consumption and investment.
To mitigate this impact, banks may take steps to boost market confidence, such as lowering interest rates or implementing fiscal stimulus packages. The aim of these measures is to encourage consumption and investment, thereby contributing to economic recovery and growth.
If assets can be too moderate, people's consumer confidence will gradually recover, and after residents' confidence is restored, consumption and investment will gradually increase. A virtuous economic cycle is very important for social development, especially when the economic pressure is relatively large, it is necessary to increase the reverse adjustment.