IS it because the CHINESE all have excessive high debt levels?
Does BEIJING have the resources to save Evergrande?
With the economy weighed down by debt and COVID-19 where will the cash come from?
PRIOR to COVID-19 in late 2019 China had incurred 7 X more debt than gross domestic product
WITH a $3 Trillion fall in market value of China’s most productive companies
-printing renminbi in the absence of real growth would lead to hyper-inflation
-too many Evergrandes
e.g. Sinic Holdings Group; its stock dropped 87%
.Guangzhou R & F Properties also facing serious difficulties
.Chinese banks are exposed
CHINA’s property sector is seizing up; home sales are falling quickly
IF Chinese leaders prevent a Lehman style crash by mobilizing state enterprises and banks China could face a decade or more of stagnation!
.debt to GDP ratio soared by nearly 45% in 5 years
.Evergrande’s debt amounts to 3% of China’s annual GDP
WHY would China face a decade or more of stagnation?
Because the CHINESE all have excessive high debt levels!
WHAT does this mean for the U.S. and AUSTRALIA?
‘EVERGRANDE’S Debt Crisis: Time to Ditch China’