Imminent China Evergrande deal will see Chinese government take control

Discussion in 'Wall St. News' started by Nighthawk, Sep 22, 2021.

  1. Nighthawk


    Sources close to the Chinese Government have told Asia Markets a deal that will see China Evergrande restructured into three seperate entities is currently being finalised by the Chinese Communist Party and could be announced within days.

    State-owned enterprises will underpin the restructure, effectively transforming the property developer into a state-owned enterprise.

    “The deal is being designed to protect Chinese nationals who have bought apartments from Evergrande, like the ones you see protesting on the streets and also those who have invested in Evergrande’s wealth management products,” the source said.

    “But the big thing is stemming any widespread economic flow-on effects that insolvency would cause on the China economy.”

    This must explain the "unexplainable" rally in Chinese real estate developer bonds:


  2. JSOP


    No mention of payments on foreign bonds?? They better not be paying out to the Chinese nationals (which they should don't get me wrong) for them to stay in power at the expense of the foreign bondholders leaving them holding the bag.

    At first didn't realize the rising prices because all the prices are in red. :D
    LuckyMac likes this.
  3. SteveM


    If the 2008 GFC would have happened today, I have serious doubts whether we would have actually had a crisis, when you consider how acceptable it has become for governments to inject trillions of xyz currency into their systems to prop things up.

    Does anyone actually believe Lehman or Bear Sterns would be allowed to collapse today? I don't believe it for a minute. Fed would have printed $2 trillion like it was no one's business and papered right over the problem.
    athlonmank8, Collagen and KCalhoun like this.
  4. zdreg


    " Fuck the greedy foreigners." That is the way of the world.:D
  5. JSOP


    No it would've still allowed them to fail. It was more of a political decision I suspect. And honestly it wasn't the failure of Lehmans and Bear Sterns that caused the 2008 financial crisis like what everybody is believing in today. It was the derivatives, the CDO's and the frauds in the mortgage business and the credit rating agencies AND simultaneous collapse of the housing market all of those factors combined that did it in. If any of these factors were not there, even if Lehmans and Bear Sterns went bankrupt, there wouldn't have been a financial crisis. Yes there would be some volatility in the asset markets but that would be it. Large companies go bankrupt all the time, we don't have a financial crisis of that magnitude every day?

    And even this Evergrande is to fail, it still would not cause a financial crisis. The amount of liabilities, first of all, is half of Lehman's which was $600+ billion. And second, like I said before, there is no derivatives from these bonds as far as I know. That's why the CCP is not too keen to bail out either especially when it doesn't give a s*** about foreign money anymore.
  6. BKR88


  7. LuckyMac


    Yeah me too it was a sea of red lol insane moves all the same
  8. Peter8519


    It's a lenders' problem.