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Evergrande Files Chapter 15 Bankruptcy Protection - The State of Chinese Real Estate

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The Plain Bagel

The Plain Bagel

Күн бұрын

Пікірлер
@ishanpandey7020
@ishanpandey7020 Жыл бұрын
It's refreshing someone actually qualified talking about finance. I am tired of "Everything is going to collapse" videos by people who are clueless.
@technetium9653
@technetium9653 Жыл бұрын
I love it when those guys set a date, it passes and then they set another date for China to collapse for it to inevitably not
@l00tur
@l00tur Жыл бұрын
No kidding, the real kicker is those other channels have millions of subs more in comparison. Quite alarming in my view. Smh
@bestdocincanada6620
@bestdocincanada6620 Жыл бұрын
Ironically, if U go their comment sections, it’s full of bots and scammers. it just shows how clickbaity titles only goes so far of having a core audience
@thedavidj1996
@thedavidj1996 Жыл бұрын
Exactly! The ignorance about economic subjects and overall macro conditions is truly staggering. Especially dangerous from those who go viral saying we are in a recession or there is some impeding economic disaster
@TwentyZZ24
@TwentyZZ24 Жыл бұрын
Everyone thinks they are an expert because they read 2 paragraph article from a "free thinking" (B.S) source. Similar to self diagnosing with Google instead of consulting a doctor... People think they know it all
@xiaomengye3562
@xiaomengye3562 Жыл бұрын
Lesson learned: do not pre-order, not video games, not real estates
@schwarzflammenkaiser2347
@schwarzflammenkaiser2347 Жыл бұрын
They will be in an unfinished state and you have to pay for them to fix it.
@halvey8518
@halvey8518 Жыл бұрын
My family pre-ordered a condo in the Philippines, the discount of getting it before it’s built is very attractive. Luckily ours is finished and has been handed over to us. I feel sorry for those families who got screwed.
@nothingtoseeherefu
@nothingtoseeherefu Жыл бұрын
it's not that you shouldn't ever do it, but you should be prepared to lose the money or expect significant delays. if you've built in that expectation and you can afford it, then go ahead
@Rayden440
@Rayden440 Жыл бұрын
In civilized countries, pre-development payments are placed into an escrow or trust account, not to be touched by the developers until they hand over the keys to you. In China, the developers take your money and immediately spend it to cover the cost of future buildings and random vanity projects like electric car manufacturing. It’s almost like a ponzi scheme.
@husky2961
@husky2961 Жыл бұрын
Same shit is happening in my country now. Its call Meikarta
@philmarley8850
@philmarley8850 Жыл бұрын
Clear, simple and no hysteria. I love your videos.
@vzxvzvcxasd7109
@vzxvzvcxasd7109 Жыл бұрын
I just caution you tho. No hysteria shouldn’t be a complement, it means you’re looking for a certain bias in coverage. And when the ship sinks, you’ll still be listening to tells you it’s fine. Just be careful. Clear and simple is good tho
@MrSubejio
@MrSubejio Жыл бұрын
What a neat business model! Taking money from new customers and using that to fulfill obligations to past customers, while scraping a tidy profit off the top? What ingenious marketing! I can't help but feel like I heard of that model somewhere else, though... nah, it's probably nothing.
@williamlloyd3769
@williamlloyd3769 Жыл бұрын
You’d have thought Chinese regulators would have made these companies use escrow accounts to tie the buyers mortgage funds to a specific property development so that companies couldn’t over leveraged themselves.
@JOGA_Wills
@JOGA_Wills Жыл бұрын
It's not a pyramid, it's a triangle hahaha
@bencomilan
@bencomilan Жыл бұрын
ppppponzi :D
@domisPL_01
@domisPL_01 Жыл бұрын
Name definitely starts with letter P. ;)
@2thousand24
@2thousand24 Жыл бұрын
It’s called the get rich scam model.
@KingUnKaged
@KingUnKaged Жыл бұрын
Thank God Richard and I live in Canada, where the real estate market is totally balanced, under control, and will never, EVER warrant a video like this one. EVER!
@2639theboss
@2639theboss Жыл бұрын
Apples and oranges. The chinese market has a much greater dependence on real estate, both as a total component of their GDP and how they store their individual wealth. And, comparing a state-run market to a relatively unrestricted market isnt really a useful exercise in this case.
@alltheusernameswastaken8936
@alltheusernameswastaken8936 Жыл бұрын
You give god to much credit, he after all also determine the destinies of the other countries.
@ThePlainBagel
@ThePlainBagel Жыл бұрын
...stay tuned for the video I post next month...
@rhythmandacoustics
@rhythmandacoustics Жыл бұрын
Lol balanced.
@KaserinoMakanen
@KaserinoMakanen Жыл бұрын
@@rhythmandacousticswhat was unbalanced about this video?
@1mzion
@1mzion Жыл бұрын
“… money from new commitments to fund old commitments …” Ah yes, the timeless ponzi.
@joewest3901
@joewest3901 Жыл бұрын
The Chinese real estate flywheel
@ParagonFury
@ParagonFury Жыл бұрын
Also the exact same reason that the US is so fucked; our infrastructure is a Ponzi scheme because we abandoned sane and gradual development plans and strategies after WW2 in favor of car-centric and accelerated plans.
@carlc6486
@carlc6486 Жыл бұрын
Also how us social security works
@leonidas14775
@leonidas14775 Жыл бұрын
It can work in theory if there's limitless demand for what they're selling, which there isn't.
@TQFMTradingStrategies
@TQFMTradingStrategies Жыл бұрын
@@carlc6486well not really since the obligations are backed by the treasury, who can print any shortfall the social security program has. Which ant much better but you’ll get your SSP, those dollars might not be able to get you much at that time then…. But you’ll get em. Just like treasuries lol.
@Kevdre3000
@Kevdre3000 Жыл бұрын
Plain Bagel posts, I hit like and THEN I watch. You know it's going to be good even before watching.
@AsianChuGaming
@AsianChuGaming Жыл бұрын
Thanks so much for another level-headed and incredibly well researched video. I especially appreciate the variety of sources you cite as supporting evidence. I would ask if you could start linking citations in the description so that viewers could check out the sources themselves, as it's not always possible to track down the original by a screenshot alone. Thank you!!!
@ecoideazventures6417
@ecoideazventures6417 Жыл бұрын
Analysts like Plain Bagel apologise for mispronounced Chinese names while clueless influencers dont hesitate about their misinformed pronouncements! BTW Bloomberg is the one source you need to check all his key sources
@tcx00
@tcx00 Жыл бұрын
Thanks for always keeping it neutral and drama free 🎉
@吳錫亮-g1z
@吳錫亮-g1z Жыл бұрын
good explain
@cisium1184
@cisium1184 Жыл бұрын
When I first went solo as an attorney I did some funds-tracing and petition-drafting work for EB-5 visa cases, mostly for Chinese nationals. Obviously I am unable to share any client information. But I can tell you many petitioners relied upon real estate value as their source of funds, and during the time I did this work I developed a weird facial tic where I furrowed my brow a lot. Entirely coincidental, of course.
@IAmTheDawn
@IAmTheDawn Жыл бұрын
Yeah, this never happened. My guy here flips burgers at a fuckin In-n-Out.
@benjaminwilson1804
@benjaminwilson1804 Жыл бұрын
​@@IAmTheDawnAre you projecting?🤨
@KP-sg9fm
@KP-sg9fm Жыл бұрын
​@@IAmTheDawnwhat is the point of your comment here? How would a fry cook even know how to fake that kind of info? And if they did, why would they want to??
@JJ-fg2wd
@JJ-fg2wd Жыл бұрын
@@IAmTheDawn big-time cope here
@Iceman259
@Iceman259 Жыл бұрын
@@IAmTheDawn +5 social credit
@Fj8282haha
@Fj8282haha Жыл бұрын
Another Weekend relaxing treat, enjoy watching w popcorn while learning new & relevant good stuff. Thx a lot Richard!
@Olmirz
@Olmirz Жыл бұрын
I'm just in cambodia atm and seeing the level of unused chinese investment is alarming. Rows of skyscrapers in central Phnom Penh, all empty as well as literal mega mansions littered outside the city each $0.5million each. All empty. Asking the locals, nobody knows who it's for. If Phnom Penh is an indication of other belt and road initiatives that could be a lot more pressure on China than we thought... it's not just the ghost cities in China....
@sting6ph
@sting6ph Жыл бұрын
$.5 Mil in Phon Phen? US? 😅 They just wanted to get loans and run with it.
@lcg3092
@lcg3092 Жыл бұрын
That has nothing to do with the belt and road initiatives. That's just real state especulation, which is stupid, but it's not a goverment initiative, nor is it unique to China. It's the same reason NY tallest buildings are ghost skyscrappers... It's billionaires trying to tie their money to land.
@ronnelacido1711
@ronnelacido1711 Жыл бұрын
Definitely corrupt Chinese officials laundering their dirty money in real estate overseas. Buildings that no one buys nor occupies. Sounds like karma.
@刺枫林
@刺枫林 Жыл бұрын
it was a casino center mostly for Chinese market ,than suddenly become illegal. the story of who invest it bankrupt is wildly spread in China (English ont so good)
@刺枫林
@刺枫林 Жыл бұрын
This is an online gambling and telecommunications fraud center,use Live gambling online it soon become a city of sin which mostly only Chinese live in ,Many wants to speculation in real estate. finnal it becomes too famous then illegal then no one live in.locals won't know there was base of China's online crime
@l_t_m_f
@l_t_m_f Жыл бұрын
I found out you are Canadian like me and I just want to say I really appreciate your work and videos.
@chickknightgreenleaf820
@chickknightgreenleaf820 Жыл бұрын
Am I imagining thing or every time, recession or financial crisis happened that have a very large or long lasting impart to the world economy, that damn real-estate sector is always on the top three spot of why said financial crisis happened
@LawlessLawyer
@LawlessLawyer Жыл бұрын
I think it's because most wealth that most people have are tied to the most common asset they have (technically, everyone should have it at some point in their adult lives), which is land/property. If every employee gets a piece of the company as part of their compensation, then almost all financial crises would be centered about capital and stock exchanges.
@slypear
@slypear Жыл бұрын
No
@robymaru03
@robymaru03 Жыл бұрын
Real estate is a good indicator of a country's wealth, the land has value, and you can't create more land, when your savings are tied up to real estate, no matter how much money is printed it wont affect you, unless world population got a sharp declined real estate will only go up.
@slypear
@slypear Жыл бұрын
70 years of Communist China's guaranteed wealth of such property~@@robymaru03
@alonzourzua2028
@alonzourzua2028 Жыл бұрын
​@@LawlessLawyertechnically we should all have property/land/territory? If you work in residential, and to a certain extent commercial construction, we would agree that most tenants and owners don't know about upkeep. It seems a seemingly insurmountable situation considering the level of education and labor required, in the US at least. I'd appreciate a response to the contrary.
@davidbiddle3257
@davidbiddle3257 Жыл бұрын
Definitely more optimistic about not having a global meltdown after listening-thanks, I do tend to over-react unless otherwise explained.
@andrewadami3920
@andrewadami3920 Жыл бұрын
That's most humans in a nutshell. You are not alone.
@samsonsoturian6013
@samsonsoturian6013 Жыл бұрын
Caveat to the falling house prices: The fall is much more severe than you think because there is very little trading volume and in some cases the only buyers are state firms bailing out their cronies.
@havencat9337
@havencat9337 Жыл бұрын
i happen to see something different here in T1 city.
@finnmcgillicuddy7907
@finnmcgillicuddy7907 Жыл бұрын
Considering there is just under 200 million people living in Tier 1 cities alone, your logic is entirely flawed and extremely orientalist. Do you really think state firms are managing to simulate the demand of a 200 million populace? (Not only simulate stable demand, but also see a 6-7% increase in prices 9:55 . Average Occident Logic.)
@dawncramer6282
@dawncramer6282 Жыл бұрын
I am happy to have stumbled upon your channel. It is refreshing to hear unskewed information. As a grandma, I must ask, "Do you always talk this fast?" I don't seem to be able to listen that fast. Thank you again for presenting this information.
@hakuhyo174
@hakuhyo174 Жыл бұрын
It’s nice to see someone who have knowledge and willing to objectively analyze the situation. Keep up the good work!
@maccrew612
@maccrew612 Жыл бұрын
Saw several videos in my feed about this, clicked on yours because you are not hyperbolic. Thank you for that.
@VictoriaMill
@VictoriaMill Жыл бұрын
Hello ❤ How Are You Doing?
@aL3891_
@aL3891_ Жыл бұрын
Balanced and level headed as always! I didn't really notice anything with your voice but I hope you feel better nonetheless :)
@timlodge8267
@timlodge8267 Жыл бұрын
It is to good to hear from someone who knows what they are taking about instead of click bait.
@bunnerkins
@bunnerkins Жыл бұрын
FINALLY! I HAVE BEEN WAITING FOR THIS FOR SO LONG!
@cdash
@cdash Жыл бұрын
A western content creator depicting a fair coverage of Chinese news? That’s rare stuff right there!
@slymetyme2975
@slymetyme2975 Жыл бұрын
Plain bagel is just diff🐐🐐
@morscoronam3779
@morscoronam3779 Жыл бұрын
You put two spaces between That's and rare. Yes, I noticed. No, it doesn't matter. Yes, I'm pointing it out anyway.
@samsonsoturian6013
@samsonsoturian6013 Жыл бұрын
Fair coverage is a bit of a weird term when China, the country, runs a ponzi scene
@creepersonspeed5490
@creepersonspeed5490 Жыл бұрын
​​@@samsonsoturian6013but he didn't add any racist bullshit or fearmongering tho, he just explained how this bankruptcy works
@USandGlobal
@USandGlobal Жыл бұрын
@@creepersonspeed5490western content creators are far better when talking about China 😂 now the CCP talking about the west is extremely biased
@brianontiveros-kersch2412
@brianontiveros-kersch2412 Жыл бұрын
Oh no! Now every finance KZbinr that doesn't actually have a finance degree or job in finance has told me that everything is going to collapse like a house of cards!
@JetJockey87
@JetJockey87 Жыл бұрын
He's a CFA and a CFP ya gronk
@jusu8961
@jusu8961 Жыл бұрын
He literally has/has had both
@bonelesswatermelon420
@bonelesswatermelon420 Жыл бұрын
​@@JetJockey87I think OP means that this topic will get milked once again by non-credible finance bros, like they did with every other finance news taken out of proportion.
@HimothyTimTim
@HimothyTimTim Жыл бұрын
Guys, he’s actually defending Bagel.
@ZeromuS_
@ZeromuS_ Жыл бұрын
​@@JetJockey87he's making fun of *other* KZbinrs How much this will hurt other countries? No clue. But more than Evergrande country garden is doing poorly also, and they're bigger. Sky isn't falling but China having big economic issues is still going to introduce some sort of instability to world markets given how big they are. So who knows what the ultimate ripple effects are if other companies have struggles in china
@timewarptrio11
@timewarptrio11 Жыл бұрын
i hope you feel better and not sick!
@wlee9888
@wlee9888 Жыл бұрын
@Plain Bagel, great vid! But I wish you went into detail about LGFV's, hidden debt obligations, growing non-debt liabilities - not just presales but also the increasing amount and severity of past-due receivables/payables that keep getting "evergreened", and declining government revenues and services in many provinces - e.g. dibao, their provincial "social security"-like welfare systems. Hopefully you can cover some of that stuff in the future! Would love to hear your thoughts.
@muhammadmustafa3158
@muhammadmustafa3158 Жыл бұрын
Please do a video on what the government approach should be on the housing crisis in Canada.
@ParagonFury
@ParagonFury Жыл бұрын
It's roughly the same as the US needs to do as per people like Charles McMohan Jr. and Jane Jacobs (I think that is her name); Namely the government (or governments if we count the US too) needs to stop supporting the suburban and car-centric lifestyle that has dominated since WW2 if not actively try to discourage it and instead focus on and reward medium-density (or medium-high density depending on region) mixed-used zoning (particularly car-free or reduced car-usage) that lets developers build a mix of housing types and units. That will let a variety of housing and home types get built and put on the market rather than the only options being the ridiculously expensive, slow to build and inefficient single-family housing typically built nowadays.
@badger_ninja8681
@badger_ninja8681 Жыл бұрын
​@@ParagonFury density and high prices go hand in hand. High density is where you get the most expensive properties not the cheapest.
@badger_ninja8681
@badger_ninja8681 Жыл бұрын
Tax incentives in problem areas with restrictions on foreign investment in residential housing would go a long way in fixing the issue. Just like New York and California Canada suffers from massive unhealthy investment driving prices ever upwards.
@muhammadmustafa3158
@muhammadmustafa3158 Жыл бұрын
Its much worse in Canada than the U.S@@ParagonFury
@KaserinoMakanen
@KaserinoMakanen Жыл бұрын
@@badger_ninja8681Yes, because high density housing is only permitted to be built in areas that already have exceedingly high demand. Outside of those areas, the construction of car dependent suburbs generates far greater profits for the automotive, fossil energy, and construction interests which dominate U.S. policy. In other words, high density planning is not intrinsically expensive.
@3d3n-w5l
@3d3n-w5l Жыл бұрын
Good advice, so much easier to follow the economy with someone who is sounding reasonable - I think you gave a good long-term perspective which investors need to navigate the short term choppy waters
@kaandervis6276
@kaandervis6276 Жыл бұрын
Why I can't find the amount of BlackRock exposure to Evergrande and Country Garden? Do you have these numbers.
@SmudgyRules
@SmudgyRules Жыл бұрын
Yes, finally a new vid! Thanks as always.
@geniej2378
@geniej2378 Жыл бұрын
Thanks for putting all this research together and sharing it, it was very informative. Keep up the great work!
@flyinggeng
@flyinggeng Жыл бұрын
Hey if the lenders reject any restructuring deal from Evergrande how much money do you think can be recovered from Evergrande liquidation?
@brian_castro
@brian_castro Жыл бұрын
Evergrand’s chapter 15 filing doesn’t mean much because it’s a legal formality addressing what has already happened. The news investors should be worried about is country garden. Plain bagel briefly mentioned them in the video, but they’re bigger than ever grande.
@jason-ub8qz
@jason-ub8qz Жыл бұрын
i am cfa candidate live in Toronto i really enjoy your content true and pure content thanks.
@soodhooku
@soodhooku Жыл бұрын
Can you do a vid on the state of the Canadian economy (real estate, the dollar, it’s stocks, etc)
@char7423
@char7423 Жыл бұрын
Plain bagel. Great video. 👍
@mr.chocolaterobot
@mr.chocolaterobot Жыл бұрын
Great Job with this content....Keep Up the Great Work....Let the Scammers be Cool.... We're Here for Knowledge.....✌🏾🙋🏾😁💰🔥🌏🤑
@nipun2735
@nipun2735 Жыл бұрын
You should do an analysis into the Canadian real estate market next, and if its on the verge of a bubble. Some analysts are now saying it openly cause of the 5 yr interest rates shocks, but then there is narrative of immigration + policy leading to supply shortage for years to come - so would that sustain the bubble? Would love to see your acute analysis.
@MarksmanSpecialist
@MarksmanSpecialist Жыл бұрын
i dont know how china drop the ball on this one, any rookie playing cities skylines knows you dont build new building and structure before there is any excessive demand. There is dramatic upkeep where it is completed or not
@duke13630
@duke13630 Жыл бұрын
They got to a point where everything depended on new customers putting money in then place them on hold while they find more new customers to sucker.
@ronnelacido1711
@ronnelacido1711 Жыл бұрын
China believes in "Build and they will come" strategy.
@EadricRicmund
@EadricRicmund Жыл бұрын
They overbuilt because that’s how they pad their gdp calculations. China had a bunch of empty houses since the 2000s which coincides when the world start noticing China’s skyrocketing GDP. Coincidence? I think not.
@Weedsethesecond
@Weedsethesecond Жыл бұрын
Thank you for this excellent explanation. Your editing skills are very nice as well!
@nmorrill
@nmorrill Жыл бұрын
Not informed enough to have a useful comment on the topic but here to help with the algo. Hope your throat gets better!
@armank10_
@armank10_ Жыл бұрын
Wonderfully analyzed man! Your videos are on point!
@bobby4716
@bobby4716 Жыл бұрын
Would love to see a video on how hedge funds short treasuries
@OnozitsCharl3magne
@OnozitsCharl3magne Жыл бұрын
Great video, subscribed! That nearly two thirds of Chinese household investment is tied up in what rhymes with a Jonzi Team will make the pain very severe for the people. China is going to have a tough go for a while as they reinvent their economy out of necessity.
@loicvalenti
@loicvalenti Жыл бұрын
what a gorgeous shirt you're wearing, where did you buy it please ? thank you !
@lenerdenator
@lenerdenator Жыл бұрын
I'm not a finance guy, so forgive me, but the taking money from new customers to fulfill past obligations mentioned @2:44... is that not more-or-less the textbook definition of a Ponzi scheme?
@lowwastehighmelanin
@lowwastehighmelanin Жыл бұрын
I'm curious how this will affect the overseas property holdings of people from China. We have a pretty large issue with unused housing here in California because of folks refusing to sell homes they don't live in ever. They just sit there. Not even on AirBnB. Do you think this will have an impact or nah? Cheers.
@creepersonspeed5490
@creepersonspeed5490 Жыл бұрын
Most Chinese people invest in property here in Australia as you don't actually own the house there, you get a 70yr lease of the building. So unless you manage to rent it out there is no point.
@creepersonspeed5490
@creepersonspeed5490 Жыл бұрын
Also to add oversupply of properties again means investing there would be a real passion project imo
@ingwerschwensen8115
@ingwerschwensen8115 Жыл бұрын
Very good. Measured. Thanks. I finally subscribed - which I should've done a long time ago.
@kickboxer8173
@kickboxer8173 Жыл бұрын
great numbers. i think the best information on real estate situation in china
@prashanthb6521
@prashanthb6521 Жыл бұрын
Thanks for this clear explanation.
@jglaab
@jglaab Жыл бұрын
LETS GOOO RICHARD WEIGHS IN ON CHINA ECONOMY!
@VictoriaMill
@VictoriaMill Жыл бұрын
Hello ❤ How Are You Doing?
@Raggart
@Raggart Жыл бұрын
Thanks for another great video, with relevant information well explained, providing us with the context to understand what's really going on.
@mahernajjar1255
@mahernajjar1255 Жыл бұрын
You’re awesome ❤
@alexeykulikov2739
@alexeykulikov2739 Жыл бұрын
Is there an award for information density per minute on KZbin?
@linhdoan1212
@linhdoan1212 Жыл бұрын
Thank you for information
@midimusicforever
@midimusicforever Жыл бұрын
So, does that mean now is the best time to buy your NFTs?
@ThePlainBagel
@ThePlainBagel Жыл бұрын
It’s never NOT a good time to pick up a bagel butt
@Lonovavir
@Lonovavir Жыл бұрын
Winners invest in Monopoly money.
@snickel2584
@snickel2584 Жыл бұрын
love this guy, states facts no b.s .
@alexandermckay8594
@alexandermckay8594 Жыл бұрын
Richard, you missed a key problem, local gov'ts were funded by R.E. land sales. There's a fundamental structural issue the way China has set up their economy and with this implosion has caused far more damage to the economies than would be expected. The knock on effects are deeper and far more resistant to fixes than might otherwise be expected.
@kitolz
@kitolz Жыл бұрын
Local governments are also putting in price controls to prevent the list price from crashing too hard, but the extreme reduction of actual real estate sales transactions reveals the damage.
@chowsquid
@chowsquid Жыл бұрын
It’s like a bank account you can live in but can’t withdrawal from
@williams1777
@williams1777 Жыл бұрын
And the us gov,, how they are being funded if they are in net negative for many years ?
@matthewrutter8343
@matthewrutter8343 Жыл бұрын
@@kitolzapparently people are getting by that by selling the place for the same price but giving the buyer post discounts by giving them stuff like gold bars. Complete madness.
@loganzrude
@loganzrude Жыл бұрын
You should make a video on the facts around the US commercial market right now. I’ve heard a lot of buzz around a potential defaulting on loans by holders of the real estate which is gonna dump a whole bunch of unleased commercial real estate on the banks which they will have to down value.
@wnose
@wnose Жыл бұрын
The borrowers could go into forbearance
@samsonsoturian6013
@samsonsoturian6013 Жыл бұрын
Except there's nothing happening
@loganzrude
@loganzrude Жыл бұрын
@@samsonsoturian6013 not yet
@GuardianGamerable
@GuardianGamerable Жыл бұрын
The graph you showed at 10:47 doesn’t really reflect exposure to Chinese markets. They’re memorandums of understandings on the belt and road initiative and even include countries like India, which are vehemently anti China 10:47
@samuelchiang7666
@samuelchiang7666 Жыл бұрын
It also marks Taiwan as part of China, which has a completely different economy and political system from China.
@gamer7cb
@gamer7cb Жыл бұрын
A well researched video. Thanks
@huplim
@huplim Жыл бұрын
Thank you for this.
@Alexandragon1
@Alexandragon1 Жыл бұрын
Thx for the video!
@the_expidition427
@the_expidition427 Жыл бұрын
Cover the Chinese property developer Country Garden matter which is going bust
@samsonsoturian6013
@samsonsoturian6013 Жыл бұрын
"Less developed" is an oxymoron since living standards are low across the board. There were some cities offerring ok wages for a time, but their cost of living was sky high while in rural regions cost of living was low but so were wages
@johnyossarian9059
@johnyossarian9059 Жыл бұрын
But, but, but cHiNa iS spIraLlInG iNtO dEflAtIoN
@samsonsoturian6013
@samsonsoturian6013 Жыл бұрын
Kinda. They're having heavy inflationary pressures due to real counterfeit bills and aggressive monetary policies, and extreme deflationary pressures due to falling wages, de-banking, and deliberate export of Yuan@@johnyossarian9059
@earthling_parth
@earthling_parth Жыл бұрын
I'm optimistic Richard
@Marcus-Lim
@Marcus-Lim Жыл бұрын
It’s hard to find non polarized information regarding China, thank you.
@andrewsteinhaus8267
@andrewsteinhaus8267 Жыл бұрын
Can you please do a video on Commercial Real Estate? I have heard a lot of Doom and Gloom, especially, since Interstates have spiked. Yet RETIs are still generating significant dividends, how is this possible?
@VictoriaMill
@VictoriaMill Жыл бұрын
Hello ❤ How Are You Doing?
@teamrocfan
@teamrocfan Жыл бұрын
Very educational’ thank you
@badluck5647
@badluck5647 Жыл бұрын
I won't even pre-purchase a video game, yet the Chinese are crazy enough pre-purchase a house. That is absolutely nuts.
@slypear
@slypear Жыл бұрын
It's the wild west (not capitalised intentionally) here, man~
@appalachiabrauchfrau
@appalachiabrauchfrau Жыл бұрын
and they still have to pay the mortgage after the house is destroyed or they file for bankruptcy, what a great system!
@chowsquid
@chowsquid Жыл бұрын
I think is based off of how Hong Kong did their real estate. You can only do this if there too much demand. If the US/ Canada has too much demand, you would see the same thing. The sellers would be in control.
@lmnisop5516
@lmnisop5516 Жыл бұрын
Is buying off the plans not done in NA and Europe? It's pretty common in Australia
@sichengliu150
@sichengliu150 Жыл бұрын
@@lmnisop5516 Australians are concentrated in the capital cities. Higher population density means many off the plans apartments. Americans cities with the exception of a few are all sparsely populated with huge metropolitan area. Most people would probably be buying second hand houses. There is actually a big unfinished apartment project in Richmond, BC. I guess these things are not limited to China.
@badger_ninja8681
@badger_ninja8681 Жыл бұрын
Im surprised there was no mention of hidden debt.
@catcatcatcatcatcatcatcatcatca
@catcatcatcatcatcatcatcatcatca Жыл бұрын
The Chinese government has much more levers to pull compared to western governments, and their incentives clearly are to protect export industries of China. I don’t think they will hesitate to step in aggressively, so extrapolating what the natural affect to the market would be is largely pointless. If necessary Chinese government could simply nationalise the big companies of the industry, restructure their development plans while honoring old contracts, by printing the funds to do so. Then start a few big infrastructural projects elsewhere to keep the industrys employment in check, while keeping a tight grip on the value of their currency: maybe force the Chinese billionaires to keep more wealth inside China. The moral of the story is: if you have the powerful market actors in a tight leash, can force your citizens to only invest in ways desirable for the national economy, and make private ownership conditional on loyalty to the nation, you can generate any demand and any supply you choose for. And as long as other nations get paid what they own and can buy actual goods with your currency, they have little reason to care how the sausage gets made. Of course China could fail to do so, but that seems unlikely. Anything that isn’t rainbow and sunshine can be kept insulated from big cities and international trade.
@Supernova12034
@Supernova12034 Жыл бұрын
is restructure just a fancy word for re-negotiate?
@slypear
@slypear Жыл бұрын
Yes
@ThePlainBagel
@ThePlainBagel Жыл бұрын
Pretty much actually
@georgeiv6925
@georgeiv6925 Жыл бұрын
Building homes in decades advance makes you go bankrupt. Its the same thing that happened with commercial shipping in the 2010s. Some hedge funds threw money to build up ships in order to get a pie from the shipping industry only to find out that revenue wasnt good enough and just sell their ships or bankrupt with loss. If theres no demand you shouldn't overbuild stuff
@jacob_90s
@jacob_90s Жыл бұрын
The one inquiry I have regarding household debt is solvency. An individual or family's debt may be low, but given the numerous issues over the last year with banks not giving customers access to their funds, well even minimal debt is an issue when you have no way to pay it back. To be clear I'm not trying to assert that the majority of Chinese citizens are about to go bankrupt. It looks like a lot of people in China are having trouble getting their money out of banks, but even if "a lot" is a million people, that may very well just be a rounding error in a country with over a billion people.
@Blabla130
@Blabla130 Жыл бұрын
13:50 Hope you feel better soon man
@slymetyme2975
@slymetyme2975 Жыл бұрын
Aye bruh imma be honest idk what you’re saying half the time but another great video as always🐐🐐
@patricksmith4148
@patricksmith4148 Жыл бұрын
I didn't know foreign companies with holdings in the US could file for Chapter 15. Do our tax dollars fund any part of a Chinese company's financial relief?
@CaedenV
@CaedenV Жыл бұрын
Such a level headed take! As always, so refreshing! I keep hearing all this stuff about how it is the end of the world and it's like... It just doesn't make sense. That isn't to say it will be a walk in the park. And it also isn't to say that the real numbers are not worse than what is being reported (because of course they are). But China just isnt the USA. The issue with the 2008 financial crisis was that risk was not appropriately labeled, and there were compounding institutional investments that made bad situations worse. This then made the banks crash quickly, which then froze up liquidity and lending capacity. When you can't pay your loan because your bank can't come up with the cash to make the transfer, it causes the whole system to grind to a halt. China frankly isn't like that. Housing is so extremely valued simply because there aren't other options for normal people to take on debt, or buy into an investment. The whole issue of it becoming so huge is because there is nowhere else to put money. On the down side, it means that if things get worse, then the housing prices may be more dramatically affected. But on the plus side, it means that it is very much limited to housing, with minimal spillover to other areas. The much bigger story going on is the belt and road defaults. China is getting a lot of pushback about their land grab plans, so they are absorbing a lot of defaults with no gained assets. I'm curious to see how that ends up playing out, as that was a huge industry for employment and pulling in foreign currency.
@kristianzomer
@kristianzomer Жыл бұрын
Could you make a a video on adyen?
@slashterix
@slashterix Жыл бұрын
Why do these companies have so much foreign debt (US$) instead us domestic (yuan) debt?
@the_expidition427
@the_expidition427 Жыл бұрын
Why use your domestic currency? There is a Cinese saying cheap things are not good; good things are not cheap.
@slashterix
@slashterix Жыл бұрын
@@the_expidition427 because their gov can probably manipulate the rates lower and everything they are buying would be in domestic currency. Labour, land, materials. Why take on the forex risk?
@cupcakeordeath
@cupcakeordeath Жыл бұрын
I am confused. How can a company miss US bond payments? Isn’t that something that only the US government can do?
@Shannon_Vlogs
@Shannon_Vlogs Жыл бұрын
Thanks for the explainer especially on the gdp % of debt ratio and low household debt. Very interesting
@Mikerty391
@Mikerty391 Жыл бұрын
Your vids are a breath of fresh air-- thank you :)
@VictoriaMill
@VictoriaMill Жыл бұрын
Hello ❤ How Are You Doing?
@Mikerty391
@Mikerty391 Жыл бұрын
hola mami@@VictoriaMill
@VictoriaMill
@VictoriaMill Жыл бұрын
@@Mikerty391 can we chat privately? I will like to know you more if that’s ok by you
@george52066
@george52066 Жыл бұрын
You should also cover the size of the shadow banking sector in China!
@willio3281
@willio3281 Жыл бұрын
Thanks again for clearing things up with zero inflammatory opinions! What you do is important
@johnercek
@johnercek Жыл бұрын
I would love it if you did a video on valorization, because it looks like China has a valorization problem
@uselesshero
@uselesshero Жыл бұрын
I know a person who has a mortgage in China on an apartment that has been "being built" for years now, with little to no progress. Her attitude is "why should I worry? Everything will work out!". This indifference to being absolutely screwed, in my opinion is enabling this shady overleverged practice, it's gross and I don't even feel bad for her anymore.
@ronnelacido1711
@ronnelacido1711 Жыл бұрын
Ignorance is a bliss
@nfuryboss
@nfuryboss Жыл бұрын
Raise a number of questions 1. Why did Evergrande file for Chapter 15 in the US instead of in China? 2. What advantages does a US filing give Evergrande? 3. A US court ruling and procedures would likely conflict with Chinese state court interests. What gives?
@ThePlainBagel
@ThePlainBagel Жыл бұрын
1) The Chapter 15 specifically addresses the part of their debt (roughly 1/3) from US creditors. A Chinese bankruptcy would be filed if it were looking to restructure the remainder of its debt. 2) The filing gives Evergrande time to negotiate with creditors without worrying about being sued for missing its contractual obligations. If granted, Evergrande gets temporary immunity from US creditors until negotiations resolve. 3) The filing only deals with the US-based debt and doesn't really deal with the business as a whole.
@uwesca6263
@uwesca6263 Жыл бұрын
He answered this. Chapter 15 is made for foreign companies. They work on it in china and they need a security line so that american investors cant sue them during their restructur.
@nfuryboss
@nfuryboss Жыл бұрын
@@ThePlainBagel Which creditors get preferential treatment/payment in bankruptcy payout/liquidations? There will most likely be a conflict of interest between what a US court ordered vs what a Chinese court ordered.
@ThePlainBagel
@ThePlainBagel Жыл бұрын
It's confusing, but this isn't a liquidation, it's a restructuring. The company is basically talking to SOME of its creditors and asking them to change the terms of their debt. It differs from a liquidation bankruptcy.
@nfuryboss
@nfuryboss Жыл бұрын
@@ThePlainBagel Could US-based creditors get short end of the stick? Let it be restructuring or liquidations. That's my main point.
@aenorist2431
@aenorist2431 Жыл бұрын
For anyone a little more interested, the channel "China Update" does reasonably good china economy / policy specific videos, short and daily. Maybe a slant negative, but overall mostly informative.
@niveajones6400
@niveajones6400 Жыл бұрын
That’s a very kind take on that channel.
@RayaneS
@RayaneS Жыл бұрын
I reckon your overview was good, but perhaps a chapter how how local governments in China need financing from real estate developers from special vehicles (which allow them to borrow while it is not really legal otherwise for them to do so). In particular, the CCP would need to rescue these local governments which is a pretty bad signal to send given their ideological line.
@rockycomet4587
@rockycomet4587 Жыл бұрын
Every time I think about this situation, I freak out.
@juwright1949
@juwright1949 Жыл бұрын
Excellent! Well done. 😊
@00HoODBoy
@00HoODBoy Жыл бұрын
youre great
@ricardodiazdeleon134
@ricardodiazdeleon134 Жыл бұрын
Whoever is your video editor is a genius of comedy.
@ntnl1212
@ntnl1212 Жыл бұрын
sheesh the bots are in full force
@DigitalNomad88
@DigitalNomad88 Жыл бұрын
"Restructuring" while they laugh at you all the way to the bank!
@zanychelly
@zanychelly Жыл бұрын
The biggest problem is the amount of savings backed by Real Estate in China. Investments usually held by middle class people, if it gets marked down that could generate a confidence problem inside their system.
@th3b0yg
@th3b0yg Жыл бұрын
The comments about consumer debt load being relatively low compared to that in the US prior to the 2008 collapse really misses the mark. 2008 was about foolish lending, and the culprits were the banks and the borrowers. That problem resolved relatively quickly because the underlying assets - the homes that people couldn't afford - were genuinely valuable. Mispriced, but valuable. In China today, as you note here, the underlying assets (apartment buildings, condos, mini-mansion homes) are in some cases being bulldozed. That's because many of them are not only unneeded, but also unfit for habitation due to incomplete construction and in some cases because they don't conform to safety standards. A bad loan on a mispriced asset is a BIG problem. But a good loan on a worthless asset can be an even bigger problem.
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