Evergrande Financial Panic - Corona is not the only Contagion China is exporting

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Sped Xing said:
I hate how nobody will give me dates. :(
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You just gotta start making some shekels, friend.

I'm not kidding when I say there's opportunity here if you know where to look to benefit from a real estate market panic that tanks China's economy. Pic related (#thisisabsolutelyfinancialadvice).
Screenshot 2021-11-09 at 18-15-14 LAC stock price - Google Search.png
 
Knight of the Rope said:
You just gotta start making some shekels, friend.

I'm not kidding when I say there's opportunity here if you know where to look to benefit from a real estate market panic that tanks China's economy. Pic related (#thisisabsolutelyfinancialadvice).
View attachment 2703088
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Sadly, when I said "I cornered the market on Lithium," she thought I was joking about her bipolar.

*sigh*
 
FatalTater said:
If Evergrande has defaulted a loan/filed bankruptcy, why is this a global big deal?
Are they the only real estate company is China?
Is real estate the only business they are in?

I just wonder why so many folks are wound up about this. I've been too busy watching a volcano to study this shit.
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To try to crash course you through why this is interesting;

Real estate makes up a big portion of the Chinese economy and the sector is heavily indebted (There's even theories that overall China has amassed the largest corporate debt in history). Large enough a slowdown or collapse would potentially wipe like 1-2 off global GDP.

In China the only form of investment for the average Chinaman is real estate. As long as China has had a real estate market the property values have gone up, and bonds and stocks are considered unstable and dangerous, so the average Chinese have significant exposure. 90% of homes bought in China in 2019 were 2nd or third homes. If a man wants a wife it's expected he will buy a house. Families take out massive unofficial debt from all sources to buy more houses.

The provincial governments of China can't get funding through taxes or your traditional methods, the gov in Beijing takes that, so the main funding for the provincial governments and their projects and maintainance is heavily financed through this weird method that involves leasing land to a company that sells it to companies to build more real estate and pile money into the system.

Evergrande is the second largest real estate company in China indebted over $300B, now that they've defaulted we could see the Chinese real estate sector bubble pop or deflate.

Global exposure directly is likely minimal; most global real estate has seen the writing on the wall and taken steps to get out. But China is facing power rationing right now, and food shortages are on the horizon, whack that with a market crash? China has already been acting irrationally on the world stage, and Xi's already been beating that Ethno-nationalist drum, things could get messy. (Reaches for Taiwan)

There is another possibility, in which China enters a Japan-style era of stagnation and the various bubble markets of China are slowly tamed back into reality. But by then, with the Chinese demographic collapse, there's a possibility that they wouldn't be able to rise back to the old Tiger economy the world has been expecting since the 2010s.

I think the Chinese might be able to keep the train on the track for another year or two but sooner or later something has to give.

Or the usual and 'nothing' happens as nothing ever happens.
 
Knight of the Rope said:
tl;dr: The $148 [million] comes due on the 11th. They already have the money.
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:story: Wow, I was wrong!

So they actually had like 99% of the $148mil that they owed (since they sold upwards of $145mil of assets the other day), but they weren't able to scrounge up a couple extra million dollars from somewhere? Kind of odd...

Oh well. Let the fun begin!
 
Ser Prize said:
Fellow Cancuckistani?
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I wish lol!

contradiction of terns said:
As China’s Property Crisis Spreads, Beijing Says There’s Nothing to See

Their premise is 'Evergrande is going to be fine now, but the rest of the property sector is in peril!'

How is Evergrande fine? Logistically and financially, can anyone explain that to me? We already covered that they can't afford to keep building stuff -- they're already paying off people with unfinished apartments -- and that they have a finite amount of holdings and personal assets which aren't enough to cover their debt.
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It isn't. 300 billion is a fucking colossal amount, they are selling assets like jets, paying people in properties (sometimes they are finished too!), either they are saving as much cash as possible to pay their debts in schedule or they are beyond busted and trying to contain the damages. But there is only so much you can sell off before you have nothing at hand!
Knight of the Rope said:
:story: Wow, I was wrong!

So they actually had like 99% of the $148mil that they owed (since they sold upwards of $145mil of assets the other day), but they weren't able to scrounge up a couple extra million dollars from somewhere? Kind of odd...

Oh well. Let the fun begin!
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Isn't that less than a single percent of their debt? If they couldn't pay this off, say goodbye to the rest lol!
 
FatalTater said:
If Evergrande has defaulted a loan/filed bankruptcy, why is this a global big deal?
Are they the only real estate company is China?
Is real estate the only business they are in?

I just wonder why so many folks are wound up about this. I've been too busy watching a volcano to study this shit.
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Caterpillar (the tractor company) in the US has sold equipment to Evergrande. Other US companies have also probably sold to Evergrande. Either they are getting pennies on the dollar for what they are owed or repossessing equipment that is used and less valuable.
 
Garm said:
Caterpillar (the tractor company) in the US has sold equipment to Evergrande. Other US companies have also probably sold to Evergrande. Either they are getting pennies on the dollar for what they are owed or repossessing equipment that is used and less valuable.
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I reallllllllyyyyyy hope those companies were smart enough to get paid up front.
 
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