It's the China government cracking down Evergrande, a private sector listed company, how come the story get spinned into saving Evergrande?
Media like to hype about "debt" as if there's nothing else on a balance sheet
, all eyes are on the US$19B bonds, how about take a look at their last financial report? Total assets ¥2,377B, total liabilities ¥1,966B (US$ bonds included), equity/net assets ¥411B, what bankruptcy? The problem is over-leveraging, lack of liquidity (in their case is low cash, high inventories), perhaps even political. If China government or any creditor force a liquidation now, all creditors/suppliers/staff will get paid, only the stock holders get burnt, note market cap as of yesterday already sunk to only ¥36B anyway. Despite its peanut size in financial system, the biggest looser is only Xu Jiayin himself, how come the state of China and the USA will lose?
China government is forcing them to monetize their ultra-high inventories aka the unsold real estates, no more hoarding, and deleverage.
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