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China’s property giant Evergrande files for bankruptcy protection in Manhattan

cnbc.com

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Re: China’s property giant Evergrande files for bankruptcy protection in Manhattan

#221

Post by bohadi »

gumballindie wrote: post #213
bohadi wrote: post #209

Earlier quoted context omitted.

history is over!

It's not over but it certainly slowed down. If you think it hasn't can you point out any meaningful innovation? Other than leveraging llms to improve last century tactics and ideologies?

For sure political innovation is a terribly slow process. I don't believe leveraging LLMs will have a direct observable effect on that until civilization AI digests for little while longer. Yes we could certainly discuss AI governance (governance by AI)

There are two other areas you would seem to point at. Firstly other technological innovation will have momentous effects, I will not name the buzzwords but you easily know from what by excluding AI/LLM. The second and far more interesting is what I will call political innovation which is orthogonal to technological development, which is totally driven by changes in consciousness. I think that often looks like a stepfunction, because I hardly see the needle moving there outside the generation-to-generation cultural noise.

Re: China’s property giant Evergrande files for bankruptcy protection in Manhattan

#222

Post by unstatusthequo »

dragonelite wrote: post #11
ipnon wrote: post #5

There are many real estate giants and so-called "trust" companies who are incapable of repaying debt right now. Some of these companies have trillions in RMB on their balance sheets. The central bank can bail them out but at the expense of the assets of the middle and lower class. This would only further incentivize cash hoarding, and tighten the middle income trap. It is not an enviable situation.

China will not be captured by the middle income trap because it has already escaped the middle income trap. The middle income in my opinion has a different reason countries get stuck there and its by design. Because the road to high income is protected by western IP protection. Patents are way for the west to forever license fees for their high end technology, China is beating the west in new IP generation and hence…

“Beating the west in new IP generation” is highly misleading. China is probably the best at IP theft, and they are certainly beating everyone at that game. Have a look at their EV cars that look like BMWs and Fords. Or their completely stolen Boeing plans. I sure as hell would not get on a fake Chinese plane, that’s for sure.

Re: China’s property giant Evergrande files for bankruptcy protection in Manhattan

#223

Post by newsclues »

lotsofpulp wrote: post #169
hulitu wrote: post #108

> China’s property giant Evergrande files for bankruptcy protection in Manhattan If it is "China’s property giant" why does it "files for bankruptcy protection in Manhattan" ? Why not in China ?

Because the people who lent money to Evergrande did so on condition that the deal was subject to the US’, and specifically New York’s, courts. Presumably because they trusted New York courts more than China’s courts in the event of a conflict.

I don't understand why NY Courts would provide this service to China. Do they get paid for it?

Re: China’s property giant Evergrande files for bankruptcy protection in Manhattan

#224

Post by worrycue »

bohadi wrote: post #210
worrycue wrote: post #197

Earlier quoted context omitted.

This isn't their only problem though. Local Government Financing Vehicles are also having trouble servicing their debts - the only way they make money is leasing out land but the real estate sector had imploded. One of their biggest lenders, Zhongrong International Trust Co. also just failed to make payments. Their economy seem to be swimming in bad debt.

local and provicial governments really dont matter. they do their best to support and bid projects for national champions and siting direct foreign investments where competitive. the areas which outperform (do least bad) have their executive talent siphoned to the central government. as FDI has dried up in the global slowdown restructuring and local reforms are due. one idea is to heavily lean on consumption which is…

> local and provicial governments really dont matter.

Local governments are broke though and their LGFVs owe people a lot of money and can't pay.

The central government I believe is bailing them out - handing out longer term loans to kick the can down the road. It's still a strain on their financial resources.

Re: China’s property giant Evergrande files for bankruptcy protection in Manhattan

#225

Post by krona »

oreally wrote: post #167
jsiepkes wrote: post #21

Earlier quoted context omitted.

> It was never about money or trade it was all about keeping asians down and dependent. Thats way too much simplification. For starters there isn't a level playing field. Any Chinese company can start a company in the west but if a western company wants to start a company in China you can either start a "second class" entity (a WFOE) or if you want a level playing field with the locals you can use a joint venture but…

> For starters there isn't a level playing field. Think about it, who determines what is a 'level playing field'? That's right, the US in this context. Every country has the right to determine it's own policies, and the US shouldn't have any say, and yet is applying pressure for it's own benefits. The same goes when China insists on one-on-one bilateral country negotiations on the issue of the south china sea instead…

The US is still nominally governed by and accountable to the rule of law.

Companies cannot use the court system in China to hold the government to account, the government is accountable only to itself.

This difference is irreconcilable.

Re: China’s property giant Evergrande files for bankruptcy protection in Manhattan

#226

Post by misja111 »

throwaway4good wrote: post #86
oblio wrote: post #58

Earlier quoted context omitted.

https://news.ycombinator.com/item?id=37171762

You can cherry pick negative news all you want. But if you a clear picture look at the aggregate for longer terms.

The CDS (credit default swap) on Chinese government bonds went up over 30% during the last week. This means that the market believes that the chance for a default on bond payments went up considerably.

If you believe you are right and the market is wrong, you should short-sell CDS'es and get rich.

Re: China’s property giant Evergrande files for bankruptcy protection in Manhattan

#227

Post by jraby3 »

drekipus wrote: post #159
adra wrote: post #2

Nice, creates corporation in tax havens to maximize tax dodging, files for bankruptcy in country that can actually put disgruntled debt owners to task. Good ol' capitalism.

* communist country is corrupt, falls apart * Good ol' capitalism strikes again. Real communism has never been tried. Yet again

There sure are a lot of examples of awful attempts though.

Re: China’s property giant Evergrande files for bankruptcy protection in Manhattan

#228

Post by nologic01 »

Fears about the Chinese real estate sector have been around for at least a decade. The amount of stuff that has been erected is just mind-boggling and unprecedented in human history. You cannot "rightsize" an exponential process.

But a spectacular bust to obliterate all speculative busts is not the deterministic outcome in this instance. The intermingling or state finances, state supported banks etc. is also a major characteristic of the Chinese system. In such a system you can push around and hide issues, redistribute the pain wherever it is politically acceptable and other such "conveniences".

One interesting question is whether the work-from-home behavioral change is further affecting the oversupply of commercial real estate in China as it does elsewhere...

Re: China’s property giant Evergrande files for bankruptcy protection in Manhattan

#229

Post by lotsofpulp »

newsclues wrote: post #223
lotsofpulp wrote: post #169

Earlier quoted context omitted.

Because the people who lent money to Evergrande did so on condition that the deal was subject to the US’, and specifically New York’s, courts. Presumably because they trusted New York courts more than China’s courts in the event of a conflict.

I don't understand why NY Courts would provide this service to China. Do they get paid for it?

I am sure there are court fees and whatnot, but more importantly, a significant portion of the tax base in New York State and New York City comes from having a well developed and functioning legal/judicial/financial system, including the people working within it to produce predictable and “fair” results.

I put fair in quotes because even though it is obviously subjective, clearly many entities around the world, including China, or investors of Evergrande, however commingled they may be, or whoever else around the world, find it “fair” enough to seek these services in this jurisdiction.

Re: China’s property giant Evergrande files for bankruptcy protection in Manhattan

#230

Post by bradleyjg »

wenyuanyu wrote: post #220

The Chinese government's approach to dealing with failing real-estate companies, including Evergrande, is distinct from typical Western bailouts. In China, the strategy often involves allowing such companies to default in a controlled manner. Given that the major lenders and banks are state-owned , this essentially means that the government bears the loss through these institutions (what else can happen anyway??) . A…

To address these challenges, the Chinese government has enforced exit bans and placed these individuals under strict supervision. They are often required to return these funds to China, potentially under threat of reduced prison sentences. This sounds not right... but yeah... it is China. And China does not have other means to use like US to extradite fugitives or request the money back even it got all the evidence... exit-ban and blackmailing are the only way China can go...

This doesn’t sound so unreasonable to me. These guys knew what game they were playing. They could have not tried to scam the Chinese government in order to build a foreign fortune and live abroad as kleptocrats.

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