https://www.caixinglobal.com/2019-0...nfirms-it-faked-financial-data-101417286.html https://www.scmp.com/business/compa...ntions-sanpowers-debt-workout-show-why-chinas The objective of the meeting was to devise a rescue plan for Sanpower Group, a hometown conglomerate with 100,000 staff on its payroll, with total liabilities estimated at more than 50.4 billion yuan (US$7.3 billion). The retailer and developer, founded by flamboyant entrepreneur Yuan Yafei in 1993, has defaulted on more than four onshore and offshore bonds as well as promissory notes worth a combined 2.6 billion yuan. When I joined in 2015, Sanpower boasted of its fast development and outstanding management. All our notebooks printed quotes of our chairman Yuan on the front page,” said Wang Xia, who remembered how the company had been trying to sell its own residential property development on Hainan island to its own staff, just before she was laid off last October as part of a corporate restructuring. “Now I understand, things started to go downward at that time. The company was running out of cash.” Out of their own concern to cap the ratio of bad loans, and having to make provisions for those bad debt, many banks are happy to cooperate with the government to give their borrowers more time, or even work together to hide problem loans, bank staff said. An effort to restructure Sanpower’s debts failed to come up with a viable plan after eight months of negotiations, as creditors failed to reach a consensus on whether the company was capable of repayment, according to several sources familiar with the matter. Genius businessmen in China!!!
Can't... China has a default problem the world has and never will see ever again, their banks defaulted on 120 Billion Yuan in January alone!!!! This is a once in a lifetime coverage, this kind of collapse will never be replicated, maybe US in 30 years will replicate to some degree ? Only other shit economy is Italy in terms of straight bad loans, but China is the king by a mile... Whole country loses money, they don't let profits get in the way of business the commies, it's just loans and loans, refinance 40 times and more loans until country collapses, like right now... Domino's falling, panic and fear of the truth is settling in, whole country now realizing it was all a fugazee, giant Ponzi Scheme. How can an economy survive where only 5 % of companies make a profit ? It's cheaper to buy food by delivery then go in store pick it up in Tier 1-2 cities in China, cause food delivery apps take 5-10 Yuan off the retail price to get business, it's reached the point where they almost all operate at a steep loss to show " growth " for more loans... Every company is a Uber in China, regardless of Industry The Biggest Lie Ever Told... One hell of a thesis!
Number of building and roads collapsing recently in China, 1 has been unreported by the news as well... Two buildings in past week collapsed, killed many and injured hundreds... Financial Collapse turning into Construction Collapse ? Even Construction, they fraud... Appalling https://www.scmp.com/news/china/soc...d-and-dozens-injured-bar-roof-collapses-china https://www.scmp.com/news/china/soc...ng-after-shanghai-mercedes-showroom-collapses
They're newer construction seems ok, anything that's older than five years and didn't have major public attention is probably shoddy though. I've seen buildings less than a decade old there that have begun to "shed" their tile exterior coats. Pretty dangerous if you're standing at a base of a building when a few of those fall.
They are falling apart, the dictator winnie came out and admitted it!!! But the tool blames it on Tariffs ? https://www.reuters.com/article/us-...s-xi-urges-as-trade-war-simmers-idUSKCN1SS13H https://www.scmp.com/business/artic...reaks-chip-makers-software-developers-bolster
Well well well, first Chinese bank to pop! Who is the crazy one now ? Didn't I call this in my thesis ? We are still in 1H of 2019.... The fun starts end 2019, 1H 2020 https://www.reuters.com/article/us-...oshang-bank-due-to-credit-risks-idUSKCN1SU1DN
Everyone knew the financial situation is bad. The question is whether their system of government allows them to deal with it in a way that doesn't cause a massive disruption. Dalio seems to think it does. In my not-so-humble-probably-asshole opinion, you should be looking for signals that the government is unable to contain the fallout. The best place for this is foreign reserves, and related things, which they cannot control.
Great thread Stockolio. I'm based in Australia and we have a bit of a China problem, in that they pretty much underwrite our economy these days. Major source of export income from iron ore, coal, education and to some extent tourism I think. The China bid on our massively overpriced housing here in Sydney seems to have gone already with prices down 15% so far. Perhaps a bit of bounce post-elections just held but longer term I expect the housing decline should continue way further than many expect. Big suspicion that China interferes in our politics and owns current and former politicians to push its interests but hard to prove. We're probably in big trouble down under if China collapses but I find it difficult to think through the consequences and how to play it. E.g. when do I shift assets out of AUD and into gold as my current asset holdings looking great. When is it optimal to short some of our big miners and other companies. It's tricky as a lot of money desperately trying to get out of China may come here and wealthy chinese buying a bolt hole and residence here past decade may all start turning up if China gets dangerous on the ground. Also US trade war may divert demand for goods away from China to more friendly sources such as Aust. I don't know the answers for Australia. But your thread is the best commentary I've read on tracking China unravelling, with supporting articles and a timeline. Look forward to more insights.