Evergrande: The Beginning of China’s Economic Collapse?
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SternAAlbifrons
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Re: Evergrande: The Beginning of China’s Economic Collapse?
Beijing seeks to orchestrate slow-motion collapse for Evergrande
AFR: Singapore/Changzhou/Hong Kong |
Tom Mitchell, Sun Yu and Thomas Hale
yesterday
Any pretence that Hui Ka Yan, once China’s richest man, remains in control of events at China Evergrande Group ended this week as state representatives took the majority of seats on a new risk management committee established by the heavily indebted developer.
"There were multiple times they could have saved Evergrande but there is no political motivation for anyone to do that"
China’s central bank, securities regulator and banks regulator all issued statements on Friday asserting that the developer’s woes stemmed from management errors and its crisis would not destabilise the financial system.
This explains the careful choreography that has surrounded Evergrande’s slow-motion demise over the past week.
https://www.afr.com/world/asia/beijing- ... 208-p59fpz
AFR: Singapore/Changzhou/Hong Kong |
Tom Mitchell, Sun Yu and Thomas Hale
yesterday
Any pretence that Hui Ka Yan, once China’s richest man, remains in control of events at China Evergrande Group ended this week as state representatives took the majority of seats on a new risk management committee established by the heavily indebted developer.
"There were multiple times they could have saved Evergrande but there is no political motivation for anyone to do that"
China’s central bank, securities regulator and banks regulator all issued statements on Friday asserting that the developer’s woes stemmed from management errors and its crisis would not destabilise the financial system.
This explains the careful choreography that has surrounded Evergrande’s slow-motion demise over the past week.
https://www.afr.com/world/asia/beijing- ... 208-p59fpz
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Mr.November
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Re: Evergrande: The Beginning of China’s Economic Collapse?
The same China FUD again and again. Same like with crypto: first China banning Bitcoin in 2013, then China banning Bitcoin again 7 more times over the years, most recently last month. Every time panic, sell-off, and whales buying the dip.
The Evergrande goes bankrupt story follows the same pattern, we heard about it going bankrupt already 3 times in the last 2 months, each time causing panic and market crash. Yet, it goes bankrupt again and panic on the markets guaranteed, and whales scooping cheap assets again...
TLDR: Ignore the headlines, buy the fear, sell the greed.
The Evergrande goes bankrupt story follows the same pattern, we heard about it going bankrupt already 3 times in the last 2 months, each time causing panic and market crash. Yet, it goes bankrupt again and panic on the markets guaranteed, and whales scooping cheap assets again...
TLDR: Ignore the headlines, buy the fear, sell the greed.
Re: Evergrande: The Beginning of China’s Economic Collapse?
On Monday, it took a 12% fall, was suspended, and rose 20% the next day when trade resumed.
Someone did ok with that!
Someone did ok with that!
Re: Evergrande: The Beginning of China’s Economic Collapse?
Agree as said before slow controlled collapse so can minipualate markets. Buying up btc whikst tellin peasents cant have. Normal behaviour.
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armchairlawyer
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SternAAlbifrons
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Re: Evergrande: The Beginning of China’s Economic Collapse?
‘Sprint at full speed’: Evergrande races to revive projects
Bloomberg News
December 27, 2021 — 3.28pm
China Evergrande Group said it has resumed construction at most of its housing projects as authorities push the debt-laden developer to pay migrant workers and deliver apartments.
Nearly 92 per cent of Evergrande’s property projects have so far restarted, compared with just about 50 per cent at the beginning of September, according to a company statement released Sunday night. The number of workers involved in the projects that have resumed building has risen 31 per cent from September to 89,000.
“As long as we do a good job in restarting work, production and construction, we’ll be able to deliver houses to buyers, resume sales and operations and pay off debts at all costs,” the statement cited Chairman Hui Ka Yan as saying at a company meeting.
Evergrande is struggling with more than $US300 billion in liabilities as a government campaign to deleverage developers and curb years of housing speculation takes a toll. Already labelled a defaulter after missing coupon payments on two bonds, Evergrande is facing a maturity wall next year and has said it plans to “actively engage” with offshore creditors on a debt restructuring plan.
Concerned that a deepening industry crisis would hurt economic growth and undermine social stability, Beijing has started to ease financing for some developers as well as homebuyers. Evergrande’s overhaul is now being guided by a risk committee that includes officials from its home province of Guangdong.
In a quarterly monetary policy statement released Saturday, China’s central bank pledged greater support for the economy while reiterating its aim to promote the property sector’s “healthy” growth, protect homebuyers’ rights, and better meet housing demand.
Wang Menghui, minister of housing and urban-rural development, said in a weekend interview with state TV that the government will make efforts to stabilise land and housing prices and ensure reasonable demand. Still, he also emphasised that housing policy won’t be used as short-term economic stimulus.
Evergrande must “sprint at full speed” to meet the goal of delivering 39,000 apartment units this month, Hui said in the statement posted online, which carries a picture of him dressed in a gold tie and black suit addressing colleagues. The target is almost four times the firm’s average monthly delivery of under 10,000 units since September, according to the statement.
Thus far, more than 80 per cent of Evergrande’s business partners such as renovation companies and long-term material suppliers have resumed cooperation with Evergrande, Hui said.
Evergrande has $US7.4 billion of local and offshore bonds due in 2022. It faces about $US255 million in coupon payments on two dollar notes on Tuesday. Most of its offshore dollar bonds are trading below 23 cents on the dollar.
Shares of Evergrande have tumbled 90 per cent in Hong Kong trading this year. The city’s stock market was closed Monday for a holiday.
Situation; "Under management", with the interests of national stability at the forefront
- of course. The apple cart. it still depends of the peoples support to keep trundling along - and Gi Gi la Ping Pong Balls is well aware of that.
Home owners have more power than under Mao these days, it seems. But they are still prepared to let property developers hang for their sins.
That's no so bad thing i suppose.
Bloomberg News
December 27, 2021 — 3.28pm
China Evergrande Group said it has resumed construction at most of its housing projects as authorities push the debt-laden developer to pay migrant workers and deliver apartments.
Nearly 92 per cent of Evergrande’s property projects have so far restarted, compared with just about 50 per cent at the beginning of September, according to a company statement released Sunday night. The number of workers involved in the projects that have resumed building has risen 31 per cent from September to 89,000.
“As long as we do a good job in restarting work, production and construction, we’ll be able to deliver houses to buyers, resume sales and operations and pay off debts at all costs,” the statement cited Chairman Hui Ka Yan as saying at a company meeting.
Evergrande is struggling with more than $US300 billion in liabilities as a government campaign to deleverage developers and curb years of housing speculation takes a toll. Already labelled a defaulter after missing coupon payments on two bonds, Evergrande is facing a maturity wall next year and has said it plans to “actively engage” with offshore creditors on a debt restructuring plan.
Concerned that a deepening industry crisis would hurt economic growth and undermine social stability, Beijing has started to ease financing for some developers as well as homebuyers. Evergrande’s overhaul is now being guided by a risk committee that includes officials from its home province of Guangdong.
In a quarterly monetary policy statement released Saturday, China’s central bank pledged greater support for the economy while reiterating its aim to promote the property sector’s “healthy” growth, protect homebuyers’ rights, and better meet housing demand.
Wang Menghui, minister of housing and urban-rural development, said in a weekend interview with state TV that the government will make efforts to stabilise land and housing prices and ensure reasonable demand. Still, he also emphasised that housing policy won’t be used as short-term economic stimulus.
Evergrande must “sprint at full speed” to meet the goal of delivering 39,000 apartment units this month, Hui said in the statement posted online, which carries a picture of him dressed in a gold tie and black suit addressing colleagues. The target is almost four times the firm’s average monthly delivery of under 10,000 units since September, according to the statement.
Thus far, more than 80 per cent of Evergrande’s business partners such as renovation companies and long-term material suppliers have resumed cooperation with Evergrande, Hui said.
Evergrande has $US7.4 billion of local and offshore bonds due in 2022. It faces about $US255 million in coupon payments on two dollar notes on Tuesday. Most of its offshore dollar bonds are trading below 23 cents on the dollar.
Shares of Evergrande have tumbled 90 per cent in Hong Kong trading this year. The city’s stock market was closed Monday for a holiday.
Situation; "Under management", with the interests of national stability at the forefront
- of course. The apple cart. it still depends of the peoples support to keep trundling along - and Gi Gi la Ping Pong Balls is well aware of that.
Home owners have more power than under Mao these days, it seems. But they are still prepared to let property developers hang for their sins.
That's no so bad thing i suppose.
Re: Evergrande: The Beginning of China’s Economic Collapse?
Where did they get the money to hire all these workers and materials if they can't even pay interest on the outstanding debt?
Re: Evergrande: The Beginning of China’s Economic Collapse?
Payroll would be a smidge compared to interest payments, plus they’ve probably been given the go ahead to continue so reserve funds of sorts.
People of the world, spice up your life.
Re: Evergrande: The Beginning of China’s Economic Collapse?
Let me rephrase the question,
Since evergrande if far away from meeting the 3 red lines required by the government they should have no access to credit at all. Given the fact that they are in deep debt with practically every possible supplier of construction materials and subcontractors as well as the fact that no foreign investor will borrow money to them where did they get the money to resume construction? Did they government allow state owned banks to provide them with more credit thus breaching the very set of rules that they used to cause evergrande to stop construction?
Since evergrande if far away from meeting the 3 red lines required by the government they should have no access to credit at all. Given the fact that they are in deep debt with practically every possible supplier of construction materials and subcontractors as well as the fact that no foreign investor will borrow money to them where did they get the money to resume construction? Did they government allow state owned banks to provide them with more credit thus breaching the very set of rules that they used to cause evergrande to stop construction?
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truffledog
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Re: Evergrande: The Beginning of China’s Economic Collapse?
they still have cash coming in from sales of appartments and other assets they have on the balance sheet (note: not every asset is as liquid as cash and may take some time to be turned into cash). And believe it or not..there are many folks and institutions out there willing to lend even in total despair ..at VERY high rates obviously)Jack.R. wrote: ↑Wed Dec 29, 2021 1:41 pm Let me rephrase the question,
Since evergrande if far away from meeting the 3 red lines required by the government they should have no access to credit at all. Given the fact that they are in deep debt with practically every possible supplier of construction materials and subcontractors as well as the fact that no foreign investor will borrow money to them where did they get the money to resume construction? Did they government allow state owned banks to provide them with more credit thus breaching the very set of rules that they used to cause evergrande to stop construction?
work is for people who cant find truffles
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