Evergrande Financial Panic - Corona is not the only Contagion China is exporting

Just saw this over lunch:
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And amid all of this Evergrande stuff coming out last month we also had this, for example:
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Keep an ear out for stuff like this, too. When the bankers are bailing out of their cushy CEO/CFO positions for "personal reasons" or because "some (non-criminal) scrutiny has fallen on their market trades", then you know something's up.
 
As much as I hate the cities, LA or Seattle or Portland being nuked would be bad. My big worry, given this scenario, is that we would be to afraid to fight back. If a nuclear strike on America guaranteed retaliation I wouldn’t be so worried about oh you know ~5 million necessary casualties. But a nuclear strike without a response? That’s really frightening.

During the Cold War, the Soviets were absolutely convinced that NATO, particularly the United States, was more than willing to initiate a First Strike without warning. This paranoia fed into their reaction to Able Archer '83, where they thought a NATO wargame involving heads of state and the theoretical use of nuclear and conventional weaponry to be a disguise for an actual first strike and invasion.

I'd say the mental calculus that formed those opinions has probably changed since the end of the Cold War, particularly in regards to the current administration and military leadership. We have the head of the Joint Chiefs supposedly telling China he's going to fucking warn them if we attack. I don't think Russia or China fears a first strike response from us and that very well might tie into any nuclear option they might take to further their goals.

I will say that I sincerely doubt either nation is interested in detonating nuclear munitions in city centers. That is an open invitation to have your own city centers attacked, which is something neither side can accept. You would see nuclear strikes on carrier strike groups or on overseas bases long before you'd see any ICBM flung anywhere near the continental United States. One airburst over Moscow, Beijing, or Los Angeles would be enough to effectively cripple the warfighting capability of any of these nations. I pulled the following example from NUKEMAP:

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If I'm the Chinese and I airburst an ICBM somewhere around Los Angeles, you can see the estimated fatalities and injuries above. Even if you take out the overwhelming number of dead, the injured will cripple the supply chain and healthcare systems of the United States. There will be more burn victims requiring specialized burn beds than there are burn beds on the entire planet. The United States (or China or Russia) would be completely incapable of engaging in a conventional war while also responding to a disaster of this scale. Vaporizing large urban centers is something that could cause an entire nation to fall on its own.

Using a tactical nuclear warhead on a carrier group or armored column is one thing - that's a national disaster, but not fatal for that nation. Nuking a city overwhelms that nation's ability to respond to that nuclear strike on a humanitarian level, much less engaging in conventional warfare. You've essentially just cucked yourself into guaranteeing a counterstrike on one of your own major urban centers, because what other option would the United States have in this example? If you lose an amphibious group crossing the Taiwanese Strait, you still might come out ahead in some fashion after the war ends. If your capital goes up in a ball of yellow fire, it doesn't matter how many cities you've nuked off the map, because you've still fucking lost.
 
What makes the East crave communism?
The East doesn't, China just sees it as a new ideology to replace their old one. China is a composed of a densely populated, wealthy, fertile, and advanced coast/river plain area, and a large, rugged, sparsely populated, impoverished interior. Coastal China is indefensible when it comes to a land invasion, hence them getting raped by steppe people with horses over and over again throughout history. The golden ages of China have all existed when the coast could control the rugged interior, giving itself strategic depth and bringing stability.

The Imperial System did this in ages past. You have an emperor who makes marriage alliances with the outlying tribes (or in the case of the Mongol or Manchurian dynasties, brings his whole court will him from the hinterlands). The imperial bureaucracy manages everything for a while and the heartland flourishes. But this system couldn't deal with industrialization or Western Imperialism, and it failed in just about the most spectacular way imaginable.

When China emerged from the ashes of the century of humiliation, it needed a new ideology to allow it to unite its disparate components. Communism (with Chinese characteristics) is that new system. This is why they split with the Soviets, why they were perfectly capable of making market reforms, and why they are now imitating Portuguese-style colonialism. Communism is just a revamped system for taking wealth from the coast and using it to develop the hinterlands enough to keep them loyal and secure. At the end of the day, geopolitics and practical concerns of security and resource availability are what guide history. Ideology is just the window dressing.
 
There will be more burn victims requiring specialized burn beds than there are burn beds on the entire planet. The United States (or China or Russia) would be completely incapable of engaging in a conventional war while also responding to a disaster of this scale. Vaporizing large urban centers is something that could cause an entire nation to fall on its own.
They just wouldn't respond to the disaster. All those people wouldn't get burn beds; they'd just die more slowly.
 
Another body on the pile today.



*edit*, by some accounts new home sales in China have dropped by as much as 90%.
 
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Not to be contrary, but the news is saying they're going to avoid default again. Apparently they made a payment today? Obviously something has to give, because Evergrande's sales have dropped 97%, so I can't imagine where they're going to get the money to keep limping along with these last minute interest payments.
Yeah, they just made some coupon payments today to avoid a default. Reading the tea leaves, i think this money is coming out of the executives personal fortunes. It's put things off for a week at most but the next tranche of debts need to be paid. They will probably try and delay those another 30 days and try and find a buyer.
 
Not to be contrary, but the news is saying they're going to avoid default again. Apparently they made a payment today? Obviously something has to give, because Evergrande's sales have dropped 97%, so I can't imagine where they're going to get the money to keep limping along with these last minute interest payments.
Yeah, I'm with you. Evergrande 'avoided' a default by the skin of their teeth, managing to pay an $83.5 million dollar interest payment while already being $300,000 million dollars in debt from missed payments. They "plan" to pay that $83.5 million dollars and have apparently sent that money to Citibank, but neither they nor Citibank want to comment about it at all.
Screenshot 2021-10-22 at 06-06-12 China Evergrande set to avert default as property developer ...png


We're beyond delaying the inevitable at this point. Evergrande is already dead; the company is basically a shambling zombie trying to pretend that it's still solvent while bits and pieces rot off nonstop.
 
They just wouldn't respond to the disaster. All those people wouldn't get burn beds; they'd just die more slowly.
exactly, is this guy from pleasantville? we have tons of examples of the US and most other countries just throwing their hands up, if the US didn't even try to do anything about a dozen LA kids stuck in afghanistan you really think milly or our other tranny generals would care about a nuclear strike?
Yeah, they just made some coupon payments today to avoid a default. Reading the tea leaves, i think this money is coming out of the executives personal fortunes. It's put things off for a week at most but the next tranche of debts need to be paid. They will probably try and delay those another 30 days and try and find a buyer.
Why are these executives still living, i thought the CCP was known for basically torturing guys like this, even if they aren't thrown in a workcamp yet, i assumed every family member for 3 generations around them is in some work camp making iphones right now, and the government basically took away their bank account info, they should be forced to work naked in the public square while doing this business, with broken legs. At least so everyone else in the industry in china can see whats coming for them in the next year when they default


Beyond all this, i guess it needs asking; would they be financially solvent if they could get every person they owe money to, to accept 1% of what they owed?
 
exactly, is this guy from pleasantville? we have tons of examples of the US and most other countries just throwing their hands up, if the US didn't even try to do anything about a dozen LA kids stuck in afghanistan you really think milly or our other tranny generals would care about a nuclear strike?

Why are these executives still living, i thought the CCP was known for basically torturing guys like this, even if they aren't thrown in a workcamp yet, i assumed every family member for 3 generations around them is in some work camp making iphones right now, and the government basically took away their bank account info, they should be forced to work naked in the public square while doing this business, with broken legs. At least so everyone else in the industry in china can see whats coming for them in the next year when they default


Beyond all this, i guess it needs asking; would they be financially solvent if they could get every person they owe money to, to accept 1% of what they owed?
The punishments will come later. Right now Xi can't risk rocking the boat to hard. You can bet your ass if they lose control of the economic situation a scapegoat will be needed.
 
Ten bucks the C-suite is already making plans to flee the country with everything they can carry.
no wonder the company collapsed, if these executives were good at their job (or at least as good at it as american ones) they would have left around this time last year. the internals usually give you a nice runway of at least 90 days and more like a year; its called a "golden parachute" for a reason. that travel visa ends for you and your entire extended family to X, suddenly becomes a stay forever deal, thats how the richer more well connected soviets did it. And it would work because that year of info you have about your company means you'd know things were going in the shitter before the people with guns would.

if you notice most companies get a new c-suite team or ceo who ends up being scapegoated for plans that were in place when the last guy jumped ship.
 
Yeah, they just made some coupon payments today to avoid a default. Reading the tea leaves, i think this money is coming out of the executives personal fortunes. It's put things off for a week at most but the next tranche of debts need to be paid. They will probably try and delay those another 30 days and try and find a buyer.
I saw the news regarding evergrande and was curious what was happening. Glad you guys are providing information and commentary.
 
no wonder the company collapsed, if these executives were good at their job (or at least as good at it as american ones) they would have left around this time last year. the internals usually give you a nice runway of at least 90 days and more like a year; its called a "golden parachute" for a reason. that travel visa ends for you and your entire extended family to X, suddenly becomes a stay forever deal, thats how the richer more well connected soviets did it. And it would work because that year of info you have about your company means you'd know things were going in the shitter before the people with guns would.

if you notice most companies get a new c-suite team or ceo who ends up being scapegoated for plans that were in place when the last guy jumped ship.
In China, being an executive at any large-ish company means being a de facto extension of the party and its institutions. I wouldn't be surprised if the party already knew how fucked things were and preemptively seized passports. These guys are going to be scapegoats to pin China's current economic woes on with the tradeoff that their families are probably going to be allowed to quietly leave abroad with a sizeable nest egg. Xi gets a win that lets him consolidate more power, the execs are put in China's version of a resort prison for a few years until things have cooled down (or shot if the party thinks they're an espionage risk), and Canada gets a few more chicom princelings with cash to prop up their housing bubble.
 
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