A good thing to test would be breaking up the conglomerate into maybe 10 or so smaller companies, then bailing them out. Some will fail some will stabilize resulting in lower debt and pushing the problem to later.
I've been told that China's economy is going to collapse for a decade now.
I've been hearing about China's collapse for 15 years. None of it seems to come true.
When Lehman Brothers collapsed, it had a 44:1 leverage. Evergrande has a 360:1 leverage. Making matters worse, they're by no means the only Chinese company facing this issue. China has, in both relative and historical terms, the single most over leveraged economy ever. It's not going to be a simple economic collapse that they trigger, but a financial black hole that sucks up anything that comes too close.
As far as I understand there is a participation of the state on every private company in China. How much is that on Evergrande?
China’s large deposits on mortgages may be their saving grace here, unlike NINJA loans in the US there is real value behind speculative investment. A nose dive in speculative markets has a measurable floor, about 30%
When I was in China I saw entire tower blocks of empty apartments and they were building more all over the place.
Force the company to split into smaller ones and create a new law on limitations of debt leveraging for large companies.
I would actually love to see a video from someone making educated guessed as to how China will navigate this.
One thing for sure is, this will probably be bad for the citizens in the end
Their citizens are already doomed from the start.
I think china will probably just take over that company and make it state owned. Seems like the only sensible solution.
Country's like to deflect from ecconic collapse by going to war an stealing wealth. So let's hope not.
China seems a country that is built on a house of cards