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2021-09-22 China-Japan-Koreas

Evergrande: Huge debt threatens to collapse, a big hit to markets but where did the money go

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Posted by badanov 2021-09-22 07:16|| E-Mail|| Front Page|| [11130 views ] Top
File under: Commies

#1 The Bernie Madoff investment model with a Běijīng Kǎoyā twist. Shocking, no ?

Posted by Besoeker 2021-09-22 07:31|| 2021-09-22 07:31|| Front Page Top

#2

So Sell now... Rent for a year, wait for the crash, then buy bigger and cheaper... like was done in 2009-2011.

Posted by NN2N1 2021-09-22 07:38|| 2021-09-22 07:38|| Front Page Top

#3 Just like our 2008 housing finance collapse, the good money went to buy toxic debt. Just as with our 2008 collapse, theirs is the result of gummint manipulation of banks.

Posted by M. Murcek 2021-09-22 08:02|| 2021-09-22 08:02|| Front Page Top

#4 A retrospective: The subprime primer - https://www.businesspundit.com/sub-prime/

Posted by M. Murcek 2021-09-22 08:04|| 2021-09-22 08:04|| Front Page Top

#5 Subprime Primer

Posted by M. Murcek 2021-09-22 08:05|| 2021-09-22 08:05|| Front Page Top

#6 Not subprime redux. Our banks didn't lend to Evergrande -- they were not allowed to by the CCP. This fallout is limited to China and a handful of non-US lenders like HSBC.

Posted by DaBigGuy 2021-09-22 08:12|| 2021-09-22 08:12|| Front Page Top

#7 I meant this was China's version of it. Not that it was a repeat for us. It will have repercussions for the US markets, though.

Posted by M. Murcek 2021-09-22 08:23|| 2021-09-22 08:23|| Front Page Top

#8 Punch bowl ladle us still a-churnin' here. Another year or two or three before the RE bubble bursts --- Jay "No Stagflation Here" Powell will see to that

Posted by DaBigGuy 2021-09-22 08:27|| 2021-09-22 08:27|| Front Page Top

#9 This fallout is limited to China and a handful of non-US lenders

However if the (non-existent) money was lent in Australia, New Zealand, Germany etc. The U.S. bank will catch the disease by association.

I remember a real estate deal in Sarasota wound up bankrupting Norway's national pension fund. Money flows into many nooks and crannies.

Posted by Fat Bob Lumumba4285 2021-09-22 11:04|| 2021-09-22 11:04|| Front Page Top

#10 Money flows into many nooks and crannies

So much so, there's a word for it: fungible.

Posted by M. Murcek 2021-09-22 11:53|| 2021-09-22 11:53|| Front Page Top

#11 Yeah, due to China's refusal to allow the yuan to circulate freely, this won't go far beyond their borders.

Posted by Blinky Pholuling8616 2021-09-22 11:58|| 2021-09-22 11:58|| Front Page Top

#12 During the Japanese 20-year, 90% top to bottom real estate crash, Japanese investors sold their foreign holdings, including the Rockefeller Center complex, at a loss. Were they convinced that Japanese price declines were just a temporary dip, or were there no buyers for Japanese real estate at prices within striking distance of the haircuts they were taking on foreign assets, meaning Japanese assets were selling at huge discounts to last bid relative to their foreign counterparts? My bet is the latter. It was probably also inconceivable to them that a property market that had risen so predictably for decades in the postwar era could contract so massively for decades on end.

But the real bottom line is that the net effect of this slo mo Japanese property and financial market crash on the outside world's financial markets was negligible. Just how big a deal was Japan's financial market crash? The all-time Japanese stock market index high was 38,957, attained in 1989. It has never regained that high. Today's number is 29,639, and that is the highest it's been in over 30 years. That's 30 years to regain 75% of the old high. For some perspective, similarly situated, size-wise, Germany has seen its stock index increase 10x in that same time interval.

Posted by Zhang Fei 2021-09-22 12:20|| 2021-09-22 12:20|| Front Page Top

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