Posted on 10/12/2023 2:43:51 PM PDT by nickcarraway
China's Country Garden recently warned it could miss making debt payments. The company is a "canary in the coal mine" for the country, according to Meyer, Unkovic and Scott Partner Dennis Unkovic. Unkovic tells Yahoo Finance Live that the Chinese economy is "in probably the worst position that I have seen it in in memory," The reason why Unkovic is so down on the Chinese economy is the woes plaguing the real estate sector, which is a big source of economic activity.
For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.
Video Transcript DANNIS UNKOVIC: I think that the Chinese economy is in probably the worst position that I've seen it in in memory. A third of the Chinese economy, as you know, is based upon real estate. The real estate is totally-- I don't even have a word for it, but it's so depressed that a third of the Chinese economy is now based upon real estate that's in freefall. I think there were some reports yesterday and today about Country Garden, which is one of the largest private real estate developers in China. They owe about $187 billion, and it's come out in the last several days they're not able to pay people.
(Excerpt) Read more at finance.yahoo.com ...
“They owe about $187 billion”
We have some money.
If you agree to take a 10% haircut, you’ll get some.
If not, hope.
Lol 10% hair cut, evergreen is saying if they go into bankruptcy you will be lucky to get 5% return and that is for high end holders of debt
Let’s see. If they go bankrupt they take us down with them. It’s like trading queens on a chessboard. Thing is they got a lot more pawns(serfs) in the form of a billion people+ no sense of shame or embarrassment should a war take out a chunk of them.
Sounds like they come out ahead.
Actually the WORLD is in a precarious state.
Here is a thought. What are the odds since all the data we get is actually from China, that the CCP thinks it is to their advantage to play up their economic problems to get more sympathy and concessions from the West, and also to make it seem to us they are not a threat?
I have written this before, the PRC real estate market is a house of cards that works like this.
Mr. Chan develops a property. Before it is finished he sells it to his Brother-in-Law, Mr. Wu for a 20% profit. Mr. Wu raises the price by an additional 20% and sell the still unfinished development to his friend, Mr. Wong for a 20% profit. Mr. Wong continues to finish the property but sells it to Mr. So for another 20% profit. Mr. So leases the property back to Mr. Chan, who subleases the retail units in the property while the residential units are finished. Mr. So then jacks the price up another 20% and sells 50% of of the project to Mr. Johnson from Australia. When the the units cannot be sold for a profit Mr. So, who is Mr. Chan’s Son-in-law buys them from Mr. Johnson at an 80% discount.
The Units are then sold for 1.20% of the original cost. Everybody except Mr. Johnson makes money.
The problem is, Mr. Johnson doesn’t play that game again and tells his friends. That means Mr. So is left with a development that 180% over financed.
But, but I thought they were going to take back Taiwan and go to war with the US? 🙄
Forget it! $187 billion? No problem. We’ll have it for you in the morning!
We will see, seems they need is more than we may ultimately need them, without exports they have no economy, like Russia China is known to have a revolution periodically
Debt ClockHalf-a-trillion more in only about a month. Tick tock.
The DC critters aimed for the American foot, and shot it clean through. With a howitzer.
Good make China 1959.
China’s economy improved because after the Demon Mao died it’s govt allowed much more economic freedom. Now that China has a new Mao it will descend back into the rubbish heap where all totalitarian govts go. Nothing can stop it.
China’s imminent collapse has been imminent for an awful long time now. Pardon me if I’d like to see some actual collapsing.
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