Posted on 11/26/2023 1:23:14 PM PST by davikkm
Amidst the deflation of the Chinese bubble gaining momentum, Beijing is responding with increasing desperation, resorting to extreme measures to salvage the nation’s financial stability.
The property market is at the epicenter of the storm, with policymakers applying unprecedented pressure on banks to address a monumental $446 billion funding shortfall. This funding is urgently needed to stabilize the industry and complete millions of unfinished apartments. A draft list of eligible developers, including industry giants like Country Garden Holdings Co. and Sino-Ocean Group, reveals a strategic pivot to aid some of the most distressed builders.
However, the challenges are far-reaching, encompassing millions of homes sold but left unfinished. More property developers defaulting on debt adds to construction delays and stalls residential projects, triggering a vicious circle of diminishing confidence in the housing market. Analysts estimate around 20 million units of uncompleted and delayed presold homes across China, necessitating over $440 billion to finish these homes.
(Excerpt) Read more at citizenwatchreport.com ...
Pardon me, I guess China is still spending money on internet trolls after all.
Anything like being $42 trillion in the whole with unfunded liabilities of $93 trillion?
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
No need to worry, according to the propaganda news media the Biden crime family has everything under control.
What’s worse is that what they’re building is tofu-dreg trash.
I am not confident this is true.
China periodically goes through warlord phases. There “corporations” and cartels could be moving away from the center particularly if there ate internal government financial problems. There is evidence for that. So maybe!
And their system is designed for only one guy to make all of the decisions.
What could go wrong.
“Pardon me, I guess China is still spending money on internet trolls after all.”
Yep, I just got a check for $1000!
And it’s so easy to troll people like you who are easily bothered by facts. It’s kinda fun!
I’m going to ask for a raise. What do you think?
So the solution is to give them more money to complete million more apartments no one will ever live in?
What could go wrong
“Yep, I just got a check for $1000!”
1000 yuan? That’s all?
(-;
Joking aside, China being broke is not mutually exclusive. We can be broke too.
How are their US properties faring?
“Joking aside, China being broke is not mutually exclusive. We can be broke too.”
That is correct, Megan! But some, especially freepers, seem to get an unjustified and inordinate amount of glee at other people dirty laundry when ours reeks even worse.
I’m having a hard time believing that about half a trillion of bad loans is going to sink an economy the size of ours in PPP term ($32 trillion).
They have a printing press too, like we do. I bet whatever rough waters they go through it wont be anything as bad as our subprime mess of 2008.
Now, I say all this not because I’m a cheerleader for China, but because I have a certain attachment to facts and reality. Don’t overestimate your ability or underestimate those of your adversary/competitor. So far, that attitude has served me OK in my life.
“I’m having a hard time believing that about half a trillion of bad loans is going to sink an economy the size of ours in PPP term ($32 trillion).”
But it’s not just $500bn in Evergrande default. It’s another $1.8tn in shadow bank defaults, REIT failures, tanking ghost city revenues, and more.
It’s some $10tn in infrastructure expenditures that include high speed rail, airports, dams, canals, pipelines, and more. None of these things are generating projected revenues because most Chinese can’t afford to use them.
There is also an infrastructure crisis hitting China (and it will hit California!) as they discover that high speed rail is not just an initial capital outlay but also an ongoing expense. China’s massive HSR system now has to be maintained and it won’t be cheap.
Their fancy new roads, bridges, airports and more also require expensive maintainence and it won’t happen in a systematically corrupt society where party members will skim funds at every turn.
Bridges built ten years ago are falling down. One HSR line was so shoddily constructed it’s being torn down. Roads are crumbling.
No, China is is deep doo doo and they were able to stay ahead of it so long as the economy was doing good. But not any more.
Foxconn has already laid off 250,000 employees and the remaining 750,000 will be let go as operations move to India in a reduced form.
It gets worse because China’s woes are a reflection of economic problems worldwide.
My own view is the world is on the cusp of depression. All the indicators are there.
Beijing is responding with increasing desperation, resorting to extreme measures to salvage the nation’s financial stability.
China currently control processing of nearly 60% of the worlds lithium 35% of nickel 65% of cobalt and more than 85% of rare earth elements.
Guess who buys them to make EV?s to support china.
No wonder Biden went to China so many times.
If you believe what you’re saying, then I have the perfect investment for you:
Sell short FXI (or any other China stock ETF), or buy a bunch of put options. You’ll make a killing when your predictions of china’s economy collapse come true!
What do you say?
Interesting. Seems FXI had a recall in September. The best time to short them would have been before that.
But you made me look and a fund that holds FXI is having problems....
https://www.ishares.com/us/products/239536/ishares-china-largecap-etf
Their overall trend across the year is downward -6.47% so far.
True, they’ve been down, but if you’re right they’re going way lower, so there’s still time to make a killing by buying puts. :)
This is where the strength of one’s conviction is tested. It’s as strong as the amount of money you’re willing to “invest” in it.
So how much are you going to ante up? 🙂
Response in pm.
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