Evergrande (Merged threads)

[Flat Bear]

14 hours ago, Freki said:

Try this

 

Are you getting corporate debt mixed up with government debt?

[Freki]

24 minutes ago, Flat Bear said:

Are you getting corporate debt mixed up with government debt?

Are you mixing government assets with national assets? 

[Flat Bear]

38 minutes ago, Freki said:

Are you mixing government assets with national assets? 

Yes

Could you explain the difference please.

[Freki]

18 hours ago, Flat Bear said:

China owns £57 billion of FTSE 100 share mainly made up of a 49% stake in HSBC

China owns £143 billion in UK assets many of them strategic.

China owns the west, infact they own much of the world.

You tell me? You are not making very precise posts so it is easy for you to muddy the water about your claims.

China owns, does that mean the Chinese government owns? Evergrande owing USD 300B is dwarfing the numbers you quoted. I really fail to see how owning 3% of the FTSE100 is owning the West

[Flat Bear]

32 minutes ago, Freki said:

You tell me? You are not making very precise posts so it is easy for you to muddy the water about your claims.

China owns, does that mean the Chinese government owns? Evergrande owing USD 300B is dwarfing the numbers you quoted. I really fail to see how owning 3% of the FTSE100 is owning the West

You know Evergrande is not any real problem on its own right?

Bottom line in the $33 billion in western investment that the CCP will not bail out, but still a small amount in global financial terms but maybe a few US bank/financial institutions will get a hit. All the internal debts will be sorted out by the CCP who will sell off the assets (possibly forcibly) to the other larger property investment companies.

The CCP is looking for internal financial stability, but much more importantly than that want 100% control. They are control freaks on steroids. They have already started to crack down on the larger Chinese tech giants and the age of free enterprise in China is coming to an end. The CCP expect all Chinese companies to do exactly what they are told without any dissidence.

Most, very nearly all, supply chains start in China. The world will collapse without this supply. China owns vast amounts of the worlds resources and holds nearly all of the more important raw materials and commodities.

Financially China has very large interests in all western countries as well as all 3rd world and emerging markets as well as owning most of the resources. This has been going on for decades.

Because of this crackdown the Chinese economy I am sure will contract with many companies defaulting. With so many western companies and governments dependant on many of these companies and institutions there will be a credit crunch and in all logical reason it will be much bigger than we have ever seen before. But still the CCP will not be bothered as long as they can have complete control. In the mean while the west will collapse.

Dramatic, I know.

[Nationalist]

If China tries anything militarily all its assets in the West will be confiscated. These assets are land, buildings, ports, factories and the like. They cannot be moved or concealed. The CCP must know this. China now has too much to lose to try anything.

China needs its house of cards to stay up, so all large Chinese companies will be bailed out. Debt any company owes to the Chinese government is very soft. The govt will just let it ride. It's not a problem.

The real problem is dollar denominated debt. This amounts to approx US$2.5 trillion. But China holds six trillion of American and other western gilts. It's covered. China can bail out its big corps.

[Staffsknot]

43 minutes ago, Nationalist said:

If China tries anything militarily all its assets in the West will be confiscated. These assets are land, buildings, ports, factories and the like. They cannot be moved or concealed. The CCP must know this. China now has too much to lose to try anything.

China needs its house of cards to stay up, so all large Chinese companies will be bailed out. Debt any company owes to the Chinese government is very soft. The govt will just let it ride. It's not a problem.

The real problem is dollar denominated debt. This amounts to approx US$2.5 trillion. But China holds six trillion of American and other western gilts. It's covered. China can bail out its big corps.

I think you'll find they cannot be confiscated only frozen.

China and the world economy are also heavily interconnected. It isn't as simple as boycott China or whack on massive sanctions.

[Saving For a Space Ship]

China Evergrande will make crucial bond payment to avert looming default – reports

The struggling property giant has wired $83.5m to creditors, Chinese media says, but deadlines loom for another $193m in payments

https://www.theguardian.com/business/2021/oct/22/china-evergrande-will-make-crucial-bond-payment-to-avert-looming-default-reports

[Will!]

18 minutes ago, Saving For a Space Ship said:

China Evergrande will make crucial bond payment to avert looming default – reports

The struggling property giant has wired $83.5m to creditors, Chinese media says, but deadlines loom for another $193m in payments

https://www.theguardian.com/business/2021/oct/22/china-evergrande-will-make-crucial-bond-payment-to-avert-looming-default-reports

Looks like Evergrande is contained.

[Freki]

20 minutes ago, Will! said:

Looks like Evergrande is contained.

For now. They have failed to get USD 4B from the sales of 2 assets and need to keep scrapping behind the couch for next week's deadline of the 29th. Anyway big cracks are showing up. The CCP is maintaining its crackdown on property speculation, while asking the banks to keep on lending to the developers. In general, the property market is cooling rapidly in China which means the developers equity will tank ultimately since the projection won't be met. 

A waterfall effect could still be in play, just later.

[spyguy]

19 hours ago, fellow said:

How many UK properties have been bought up by Chinese investors and how many of these will need to be sold to pay back their creditors? Will this spook other foreign investors into selling up as well and would this be enough to cause a complete reversal of supply vs demand?

How many oversea property have been bought by Chinese citizens, legally according to Chinese law - zilch.

Up til ~2008ish, China was pursuing a mental mercantilist policy, aggressively - and illegally - exporting its labour.

2008 and it switched to creating internal demand, mainly around domestic property and vast civil engineering projects - or dubious quality. This CE was continue with Be;t n road.

Concrete, in its various forms, now makes up a significant part of Chinas compnay./demand.

 

 

[bodgittandscarper]

Sounds like this first payment was a surprise- everyone expected a default. What if the CCP are propping up Evergrande in secret? Face is everything in Chinese culture, after all, and it could be in their interests to delay or ever avert the collapse for now.

[Social Justice League]

Imagine Western Capitalism being controlled by Communist China...............

It shows me that the 'America Dream' model was always a load of old rubbish and that China just had to be patient, as they have done for thousands of years.

Western (American) capitalism is actually finished and has been finished for decades imo.  We gave control to China without thinking and here we are.  Fubar.

[fellow]

2 hours ago, Social Justice League said:

Imagine Western Capitalism being controlled by Communist China...............

It shows me that the 'America Dream' model was always a load of old rubbish and that China just had to be patient, as they have done for thousands of years.

Western (American) capitalism is actually finished and has been finished for decades imo.  We gave control to China without thinking and here we are.  Fubar.

The West ceased to be capitalist when they bailed out the banks in 2008 and started propping up the stock market and housing market with printed money at the slightest hint of a downturn. They have effectively capitilsed the gains and socialised the losses and all this has achieved is it has sucked money out of the productive parts of the economy, devalued the currency and increased the gap between the rich and the poor.

if they had let the market correct itself (capitalism), our standard of living would be substantially higher.

Edited October 22, 2021 by fellow

[TheCountOfNowhere]

18 minutes ago, fellow said:

The West ceased to be capitalist when they bailed out the banks in 2008 and started propping up the stock market and housing market with printed money at the slightest hint of a downturn. They have effectively capitilsed the gains and socialised the losses and all this has achieved is it has sucked money out of the productive parts of the economy, devalued the currency and increased the gap between the rich and the poor.

if they had let the market correct itself (capitalism), our standard of living would be substantially higher.

Spot on.

[Locke]

32 minutes ago, fellow said:

The West ceased to be capitalist when they bailed out the banks in 2008 and started propping up the stock market and housing market with printed money at the slightest hint of a downturn. They have effectively capitilsed the gains and socialised the losses and all this has achieved is it has sucked money out of the productive parts of the economy, devalued the currency and increased the gap between the rich and the poor.

if they had let the market correct itself (capitalism), our standard of living would be substantially higher.

It started way before then. If regulation and taxation had stayed where they were in the 1950s, the median worker salary would be $250k in the US today.

It is hard to fathom how much government robs of each and every one of us. They permit us to receive less than crumbs of our own potential, then tell us that that it is an excess of liberty which is causing our woes.

Commies are not people, really.

[Freki]

1 hour ago, Locke said:

It started way before then. If regulation and taxation had stayed where they were in the 1950s, the median worker salary would be $250k in the US today.

It is hard to fathom how much government robs of each and every one of us. They permit us to receive less than crumbs of our own potential, then tell us that that it is an excess of liberty which is causing our woes.

Commies are not people, really.

I am not too sure if it is only the government's fault. CEOs being paid 1000x avg wage of the company is an issue that has nothing to do with the Gov. I fail to see how you can put your faith in having a society that would not descend into chaos if the gov did not exist.

[Flat Bear]

20 hours ago, Nationalist said:

If China tries anything militarily all its assets in the West will be confiscated. These assets are land, buildings, ports, factories and the like. They cannot be moved or concealed. The CCP must know this. China now has too much to lose to try anything.

China needs its house of cards to stay up, so all large Chinese companies will be bailed out. Debt any company owes to the Chinese government is very soft. The govt will just let it ride. It's not a problem.

The real problem is dollar denominated debt. This amounts to approx US$2.5 trillion. But China holds six trillion of American and other western gilts. It's covered. China can bail out its big corps.

Yes

There are some really strange paradoxes here.

What is the aim and the ultimate goal of the CCP? It has been said they are looking at a very long-term goal but ultimately expect to control the world.

Chinese companies have targeted mostly strategic assets throughout the world especially in the US and the UK. It has got to a stage where they now have too much control for our good and it is worrying. But what can they do, or what will they ultimately do with this control?

China and Chinese corporations (these must be considered one and the same as the CCP have absolute control of all companies) own much of the west including many strategic assets. The west owns zero, ziltch, nothing in China as the CCP will not allow it. Even the currency is protected and is unavailable to purchase outside of the country.

It seems they have taken a change in direction where they are clamping down on all the larger Chinese corporations and taking control at the same time as taking tight control of its people and looking to affirm control over new provinces and look to start what could be seen as an expansionary policy in the South China Sea. It is a worrying time but as you say purely on a financial basis the fixed assets in the US, or the UK could be taken back in a time of war. I think it would need to come to this if the US decided to unilaterally confiscate Chinese assets.

I had thought it was the CCP intention of crippling the west financially which they are already in a position to do now without resorting to military means.

Yes, China would lose if they tried anything, but the west would lose a lot, lot more and I think the CCP could possibly be more interested in gaining more power and control than any possible financial prosperity. They are not playing by the same rules.

6 hours ago, bodgittandscarper said:

Sounds like this first payment was a surprise- everyone expected a default. What if the CCP are propping up Evergrande in secret? Face is everything in Chinese culture, after all, and it could be in their interests to delay or ever avert the collapse for now.

Yes

They will cover up the most blatant events. It was nice to see those at re-education camps enjoying themselves in formal dance on the state-owned news site.

Just take Covid-19. We know it came from the Lab.; everybody knows this. The only question in my mind was whether it was deliberate or an accident. I could not rule out it wasn’t a deliberate attempt to weaken the west although it did not in that case go exactly to plan.

Biden saying this morning that the US would come to Taiwan defence if China attacked, might not have been the wisest time or thing to say. Would the US intervene if China attacked Taiwan? We may find out shortly.

As you say, "it could be in their interests to delay or ever avert the collapse for now." is the big question.

[Locke]

1 hour ago, Freki said:

I am not too sure if it is only the government's fault. CEOs being paid 1000x avg wage of the company is an issue that has nothing to do with the Gov

How do you know?

1 hour ago, Freki said:

I fail to see how you can put your faith in having a society that would not descend into chaos if the gov did not exist.

I'm actually not arguing against the government.

If I say "rape is always evil", then I am not directly arguing against forced marriage. But if you say "forced marriage is necessary", then you are also saying that rape is permitted.

When you make these kind of consequentialist arguments, you are advocating evil. "Without a government, there would be chaos!" is morally identical to "Without rape gangs, the fertility rate would fall below replacement!"

 

The initiation of force against peaceful people is always evil.

A government is a group of people who claim that for them alone it is moral when they initiate force against peaceful people.

Therefore, government is always evil.

 

Fortunately, while enough people support evil to enable the existence of a government, the corollary is that a stateless society will emerge when enough people oppose evil.

Edited October 22, 2021 by Locke

[Freki]

1 hour ago, Locke said:

How do you know?

I'm actually not arguing against the government.

If I say "rape is always evil", then I am not directly arguing against forced marriage. But if you say "forced marriage is necessary", then you are also saying that rape is permitted.

When you make these kind of consequentialist arguments, you are advocating evil. "Without a government, there would be chaos!" is morally identical to "Without rape gangs, the fertility rate would fall below replacement!"

 

The initiation of force against peaceful people is always evil.

A government is a group of people who claim that for them alone it is moral when they initiate force against peaceful people.

Therefore, government is always evil.

 

Fortunately, while enough people support evil to enable the existence of a government, the corollary is that a stateless society will emerge when enough people oppose evil.

All of that to advocate for what exactly? You are going through various hyperboles but fail to explain to me what kind of government you want. You want a government, but no tax from what I pieced together

[felix]

Record China Defaults in Focus as Modern Land Joins the List (yahoo.com)

 

"Chinese authorities told billionaire Hui Ka Yan to use his personal wealth to alleviate Evergrande’s deepening debt crisis, according to people familiar with the matter."

Super!

[dpg50000]

9 hours ago, felix said:

Record China Defaults in Focus as Modern Land Joins the List (yahoo.com)

 

"Chinese authorities told billionaire Hui Ka Yan to use his personal wealth to alleviate Evergrande’s deepening debt crisis, according to people familiar with the matter."

Super!

From that article - Yikes!

 

Also hindering capital-raising is the surge in yields on Chinese junk-rated debt, recently reaching their highest in a decade at 20% and resulting in the country’s developers making up nearly half the world’s distressed dollar bonds.

[Saving For a Space Ship]

Kaisa, units trading suspended as debt crisis routs Chinese developers' shares

https://www.reuters.com/business/trading-shares-chinese-developer-kaisa-group-units-suspended-2021-11-05/

Speculation nation: Can Xi Jinping’s property tax deflate China’s housing bubble?

https://www.theguardian.com/world/2021/nov/05/speculation-nation-can-xi-jinpings-property-tax-deflate-chinas-housing-bubble

Quote

However, one key initiative – introducing a local property tax – has attracted fewer headlines but is apparently so controversial within China’s ruling Communist party that even Xi is still only able to deal in trial schemes rather than wholesale change.

 

The decision to pilot the tax on all types of property in selected regions for five years – most likely important cities such as Shenzhen and Hangzhou– was taken last month. It is seen as vital to reforming the country’s bloated property sector, a concrete-and-glass divide between China’s haves and have-nots which has been personified by the woes of the heavily indebted developer China Evergrande.

The property tax is controversial because local governments rely on land sales for at least 40% of their revenues. This has encouraged an aggressive sales policy, aided and abetted by property developers happy to take on massive debts to buy the land and build ever more apartment blocks for buyers convinced the market is a one-way bet.

 

End to China’s estate market boom could spell trouble for the economy

George Magnus

Read more

This decades-long party saw China’s property developers build a debt mountain of around $5tn, according to analysts at Nomura, before Beijing called time by restricting what they could borrow. When the music stopped, Evergrande was stranded on the dancefloor with $300bn of debt, and it faces its latest pay-up-or-default deadline on 10 November.

Evergrande is just the tip of the iceberg though. Developers have to repay around $92bn in the next year, and analysts at S&P have estimated that more than a third could experience difficulties meeting those obligations....

 

Edited November 5, 2021 by Saving For a Space Ship

[Freki]

That Guardian article is excellent

[msi]

Just now, Freki said:

That Guardian article is excellent

careful you don't called a LefTiE lIbTaRd LoOnIe