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 Post subject: Re: China on ‘Treadmill to Hell’ Amid Bubble.
PostPosted: Mon Sep 19, 2016 7:46 pm 
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Too Big to Fail

Joined: Aug 23, 2008
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Location: Bogtrotterland!
China's debt crisis: Just how bad is it?
Quote:

http://www.bbc.com/news/business-37404838

A full blown banking crisis in three years' time. The warning from the Bank of International Settlements (BIS) certainly sounds dire, and it should be taken seriously - but don't forget China's banking system is still relatively well protected because it is largely state controlled.

That means that in the event that some Chinese banks face massive defaults, the Chinese government could and very likely would bail them out.

The way the BIS's risk instrument is calculated is also worth taking a look at: the credit to GDP gap is basically a measure of how much banks are lending, compared to the size of the country's economy.

What that means is if banks lend too much, and the economy is shrinking, the gap widens - and that's where the risk of a banking crisis is created. Individuals and companies won't be able to pay back their loans at a time when economic growth is sluggish.

But China needs this debt, because it is helping the economy to grow.

China's economy has been slowing down, and one of the ways that growth has been propped up is through debt, which is now thought to be worth 225% of GDP, according to, amongst others, the International Monetary Fund.

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 Post subject: Re: China on ‘Treadmill to Hell’ Amid Bubble.
PostPosted: Sat Sep 24, 2016 8:17 pm 
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Fitch reveals the $2trillion black hole in China's economy that heralds a lost decade - Ambrose Evans-Pritchard -> http://www.telegraph.co.uk/business/201 ... laims-sta/

Quote:
Bad debts in the Chinese banking system are ten times higher than officially admitted, and rescue costs could reach a third of GDP within two years if the authorities let the crisis fester, Fitch Ratings has warned.
The agency said the rate of non-performing loans (NPLs) has reached between 15pc and 21pc and is rising fast as the country delays serious reform, relying instead on a fresh burst of credit to put off the day of reckoning.
It would cost up to $2.1 trillion to clean up this toxic legacy even if the state acted today, and much of this would inevitably land in the lap of the government.

there is more



UN fears third leg of the global financial crisis - with prospect of epic debt defaults - Ambrose Evans-Pritchard -> http://www.telegraph.co.uk/business/201 ... epic-debt/

Quote:
What is clear is that world will soon need a massive and coordinated spending push by governments to create demand and bring the broken global system back into equilibrium. UNCTAD is entirely right about that.
If this does not happen, it is sauve qui peut.

there is more


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 Post subject: Re: China on ‘Treadmill to Hell’ Amid Bubble.
PostPosted: Wed Sep 28, 2016 3:16 am 
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Posts: 9018
Location: Hollywood
Who is lending to China?


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 Post subject: Re: China on ‘Treadmill to Hell’ Amid Bubble.
PostPosted: Wed Sep 28, 2016 10:43 am 
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Real Estate Developer

Joined: Nov 20, 2014
Posts: 994
Blindjustice BATONEFFECT wrote:
Who is lending to China?


China


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 Post subject: Re: China on ‘Treadmill to Hell’ Amid Bubble.
PostPosted: Thu Sep 29, 2016 2:43 pm 
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Real Estate Developer

Joined: Jun 10, 2010
Posts: 889
mightyz wrote:
110sq meters
rent cost without furniture or aircon is 2400 RMB / month or 1500PLN, 330€..
buy is around 700kPLN or ~1 500 000 RMB so ~204k€


Approx 1.8% rental yield which is extremely low in China

satechi wrote:
Blindjustice BATONEFFECT wrote:
Who is lending to China?


China


I can only assume these construction companies are state owned and the government passes on subsidised rent to maintain a competitive econony.
If it goes wrong, no real loss

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 Post subject: Re: China on ‘Treadmill to Hell’ Amid Bubble.
PostPosted: Tue Oct 04, 2016 8:52 pm 
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Under CAB Investigation

Joined: Feb 1, 2008
Posts: 2900
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Quote:
When China’s richest man and its most successful real estate developer calls the country’s overheating property market “the biggest bubble in history,” it’s probably not a good sign.

http://www.theepochtimes.com/n3/2165350-bubble-watch-experts-sound-alarm-on-chinese-real-estate/


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 Post subject: Re: China on ‘Treadmill to Hell’ Amid Bubble.
PostPosted: Thu Oct 06, 2016 3:05 pm 
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Joined: Apr 1, 2010
Posts: 10924
Quote:
China city blocks sale of tiny 'pigeon nest' homes

Officials in a southern Chinese city have blocked the sale of apartments so small that they were nicknamed "pigeon nests" by the media.

The authorities in Shenzhen acted after photos of the micro-homes went viral on social media. Priced at 880,000 yuan ($132,000; £102,000), each of the nine units has a fold-down bed and what's described by the Sixth Tone website as a "kitchen-cum-bathroom". There also appears to be a television on the wall above the cooker.

Officials said each apartment in the 15-storey building is 6 sq m (64 sq ft). Current national regulations require residential dwellings to be at least 22 sq m.

Several of the apartments were snapped up by eager buyers, but the local land authority stopped sales after an investigation found the space had been illegally converted, the South China Morning Post reports.

The officials said the number of flats sold had been exaggerated by real estate agencies. Those who had hoped to purchase one of the homes will now have their contracts rescinded, according to China Radio International.

Users of the microblogging site Weibo are amused and aghast in equal measure, particularly at the proximity of cooking and lavatory facilities. "A toilet outside the kitchen... the smell of poo in cooking - great," reads one comment. Many express frustration about housing costs - one calls the situation "crazy", while another remarks: "It's sad that nearly a million will buy you your own multi-functional prison." But, as one person points out, some people are willing to pay it: "While you were still busy laughing, these have been selling out."

http://www.bbc.com/news/blogs-news-from ... e-37472472

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 Post subject: Re: China on ‘Treadmill to Hell’ Amid Bubble.
PostPosted: Thu Oct 06, 2016 8:12 pm 
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Joined: Jul 31, 2011
Posts: 1425
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https://en.wikipedia.org/wiki/Kowloon_Walled_City :)

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Why it was so windy there?... I am out.

For future reference, a 'soft landing' theorem:
06/2007: Central Bank predicts soft landing for housing
http://www.independent.ie/business/iris ... 96858.html
It's all grand


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 Post subject: Re: China on ‘Treadmill to Hell’ Amid Bubble.
PostPosted: Sat Oct 08, 2016 7:18 pm 
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Planning Tribunal Attendee

Joined: Jul 31, 2011
Posts: 1425
Location: 0-71

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Why it was so windy there?... I am out.

For future reference, a 'soft landing' theorem:
06/2007: Central Bank predicts soft landing for housing
http://www.independent.ie/business/iris ... 96858.html
It's all grand


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 Post subject: Re: China on ‘Treadmill to Hell’ Amid Bubble.
PostPosted: Mon Oct 24, 2016 5:42 pm 
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Too Big to Fail
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Posts: 4875
Location: the nearest faraway place

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