From Eric Li to Li Lu: Once They Sold Greatness, Now They Sell Bullshit and Excuses
In 2013, Eric Li told a TED audience that China's growth showed what one-party rule could achieve. In 2026, Li Lu told a Columbia audience that the collapse in household property wealth was one of the costs of upgrading Chinese industry, before explaining why Chinese businesses offered attractive investment opportunities.
The circumstances have changed, but the argument still ends with a reason to trust the Party and put money into China. When people were getting richer, their wealth proved the government knew what it was doing; now that they have lost money, their losses are presented as the price of another government achievement.
Li Lu's account connects two things that need to be proved separately: that some industries have improved, and that the damage to households was necessary to make that happen. A better battery does not explain why a family had to lose its savings, and a successful carmaker does not prove that officials handled the housing market well.
The property boom was not something the government merely watched. Authorities supported borrowing and home purchases, promoted cash compensation for redevelopment, and collected enormous sums from land sales. Their policies helped expand a market that supplied local governments with income and supported further borrowing.
When that market fell, the government's own finances suffered. Annual land-sale revenue dropped from about RMB8.71 trillion in 2021 to RMB4.15 trillion in 2025, more than halving a major source of local government income. Officials still needed money to run departments, service debts and maintain the institutions that keep them in power, whether or not an electric-vehicle company was doing well.
The obvious question is why anyone should assume they intended all this damage. They could have overestimated their ability to control the market, misunderstood how their decisions would spread through the economy, and discovered too late that they were cutting into their own income.
Lower mortgage costs, easier purchase terms and government-backed purchases of unsold homes show attempts to stop the decline. If falling property wealth was simply the government's chosen route to a stronger economy, its subsequent efforts to halt that fall require an explanation.
Li Lu instead gives investors a story in which the government remains farsighted, households bear the cost, and cheap shares become the reward for understanding the plan. This is how an excuse for losses becomes an invitation to invest, without first establishing that the losses were either necessary or under control.
Munger's advice to fish where the fish are cannot fill that gap. A market can be cheap because other investors have missed something, but it can also be cheap because they understand the danger. Before putting in money, investors need reasons to believe that profits will reach shareholders and that the government will not change the rules against them.
Explaining that an investor might become tomorrow's "cost" does not answer those concerns, and predicting that the stock market must eventually become a government "objective" offers no enforceable protection. It asks investors to replace rights with confidence in whatever the authorities may decide next.
The appeal serves both the authorities and investors who already own Chinese businesses: policy failures acquire a respectable explanation, while weak prices acquire a hopeful one. A persuasive story may help attract money, but it cannot establish that the money will come back.
Eric Li sold confidence by pointing to growth, while Li Lu's account sells it by explaining away losses. The message has moved from "look how well we govern" to "look how much you could make if you understood us," with the public once again being asked to pay for the government's reputation.