Posted on 11/15/2023 10:30:47 AM PST by george76
A massive $124.5 billion worth of bonds are now in default in the entire $175 billion China property dollar bond sector
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Counting October, there is a total of $60.5 billion worth of Chinese property bonds due in the next 6 months, with offshore bonds taking up at least one third of it
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Country Garden's international bondholders are now seeking urgent talks with the company.
Strains have also shown in other companies. State-backed Sino-Ocean Group
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Another major developer Gemdale .. seen its bonds slide after the resignation of its chairman sparked fears that it too may be in financial trouble.
Dalian Wanda Group has started negotiations on a proposal to avoid repaying about 30 billion yuan ($4.11 billion) if it fails to complete a initial public offering (IPO) plan this year
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China's new home prices fell for the third straight month in September
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Ricky Tsang, an analyst with S&P Global Ratings, said apart from the weak cash flow from home sales, fund raising for developers, particularly the private ones, remains tight.
"Developers who are most in need of financing are struggling to find qualified assets, in most cases shopping malls or office buildings, as pledges to issue guaranteed bonds," Tsang said.
(Excerpt) Read more at reuters.com ...
China has no property sector. It is dead and gone, a memory
There’s a lot of contradiction here. For years, China (particularly local governments) used the property sector to goose economic growth, help grow local tax revenues, and line the pockets of corrupt local officials.
Many commentators, both in China and outside China said “you can’t keep blowing the property bubble.”
So now, Xi Jinping is actually doing something about it - and Ironically, now the narrative is “the economy is crashing.” Under his policies, China is now trying to slowly deflate their property, without crashing it, and has used this to attack a lot of the CCP internal corruption and grifting tied to the property bubble (which he can also use to go after political enemies too)
So will China deflate its property bubble? definitely.
will its economy “crash” - probably not.
They owe American investors (their heirs) over $1.6 trillion that they haven't paid a penny on almost as long as Brandon has been alive. And we're supposed to think that China is some kind of good investment?
FDR defaulted on gold-backed government bonds when he confiscated Americans' gold in 1933. I wouldn't trust any government long-term.
Unless you are Microsoft or Exxon, and can call the US Ambassador in Beijing or your Senator for help, I would not suggest any American invest in China. You will get stripped bare.
Good step forward to make China 1959 again.
“As soon as China became communist they announced that those treasuries didn’t have to be paid because they were done by the “prior” government.”
That will be our .gov future game plan at some point—the debt that cannot be repaid will not be repaid.
This would be a really good time for the PRC to retake Siberia.
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