The big problem for EverGrande creditors is that the sales value is likely to be a small fraction of book value, if they can sell it at all. I'm guessing a MAX of 20%. More likely 5-10%. Who is going to buy a partially completed building the condos of which have already been sold to other people?
If you thought the 2008 sub-prime unwinding was painful you ain't seen nothing yet. There we had only over built less that 8%. The PRC has over built its housing market by about 150% and has a SHRINKING population.
This is going to wipe out the savings of a broad swath of the Chinese people and likely lead to the one thing the CCP fears most, civil unrest. The people will be looking to the CCP to fix things but the Party is out of arrows in that quiver.
Compounding the problem for the CCP is that some of the major beneficiaries of the building boom were the families of senior CCP officials at all levels. They aren't going to give up all their money to pay back the peasants.
This is going to be interesting and not in a good way. Turbulent times are ahead and NOT just for the PRC. The pain from this is going to be spread around as the PRC economy unwinds.
SpyNavy
Garde la Foi, mes amis! Nous nous sommes les sauveurs de la République! Maintenant et Toujours!
(Keep the Faith, my friends! We are the saviors of the Republic! Now and Forever!)
LonePalm, le Républicain du verre cassé (The Broken Glass Republican)