This is why Chinese companies need to be banned from US Stock Exchanges and Bond sales, as well as inclusion in indexes, unless they fully comply with all reporting, disclosure, auditing and oversight - like real companies have to.
The fraud in Chinese businesses is astronomical and pervasive. We need to decouple before that whole teetering mess comes crashing down.
China’s second biggest property developer is attempting to trigger its escape plan - shuffle papers to dump their bad debt into a publicly held company, to stick its shareholders with their bad debt.
Could be a sign of the long overdue debt/banking/real estate bubbles starting to burst.
The Achilles heel of the Chinese economy is the fact that the Communist Party essentially controls investment banking. They have squandered huge amounts of capital on outdated military equipment and projects suchas “ghost cities” which remain uninhabitated and deteriorating. Urban Chinese real estate is ridiculusly overvalued and there are huge loans based on inflated values that can never be repaid. They can blame Trump for giving them the big shove but their weak foundation is of their own making.
China business is not having a good year. The Wuhan Virus outbreak may have started in 2019, but it stayed into the (western) new year. Then at the end of June, there was a major gold bar fraud when a Wuhan (again) refiner/jeweler, Klingold, got caught with 83 tonnes of fake gold as assets on business loans of $4+ billions. Oops!