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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: ggersh who wrote (179649)	10/25/2021 10:37:02 PM
From: TobagoJack	Read Replies (1) \| Respond to of 217749

As far as I am guessing, the more folks pss-off Erdogan, the harder he shall charge. Difficult to imagine a followup leader for like-minded Turkey. In the meantime, per <<<<Dark Side of China>>>> Message 33528023 we mill food for rumination ... bloomberg.com China's Mystery 'Authoritative Person' Resurfaces to Explain Crackdowns* Ye Xie 26 October 2021, 07:59 GMT+8 In 2016, an unnamed “authoritative person” gained international prominence by laying out the long-term economic thinking of China’s top leaders, saying in state media that the government should prioritize cutting leveraging instead of juicing up GDP growth. The person, widely believed to be President Xi’s right-hand man -- China’s Vice Premier Liu He and his team – has stayed relatively quiet since then. But in a lengthy interview with Xinhua over the weekend, the “authoritative person” resurfaced. Along with “authoritative” government bodies, the mysterious person projected confidence in the economy, despite growing pessimism among economists. If there’s still any expectation of large-scale policy easing, this mysterious person made it clear that’s probably unlikely. Liu He in 2020. Photographer: Zach Gibson/Bloomberg In the Xinhua article tiled “Ten Questions on the Economy,” the authoritative figures said policy makers are determined not to flood the economy with stimulus while cutting a reliance on property and debt. The piece downplayed growth risks, saying that job creation, consumer prices and international trade also paint a picture of a steady economy. Instead of propping up the economy, the supply-side reform to weed out overproduction in polluted industries and curb the housing market remains the main focus. While it didn’t rule out policy fine-turning – the article signaled that more measures to promote internal demand are coming -- the tone of the interview was rather sanguine. It stands in contrast to the more dour view of economists who have downgraded China’s growth next year to below 5% amid the power shortage, housing curbs and periodic Covid outbreaks. The hawkish stance – focusing on the longer-term structural issues, instead of overreacting to short-term gyrations – is consistent with the tone of the “authoritative person” when they first emerged a couple of years ago. In May 2016, as the economy bounced back from the burst of the stock bubble, the People’s Daily published a full-page interview with the “authoritative person,” warning that an L-shaped recovery (rather than a U- or V-shaped rebound) is the new normal. China should put deleveraging ahead of short-term growth and needs to be proactive in dealing with rising bad loans, rather than delaying or hiding them, the person said. The prior article briefly sank the stock market. By the second half of 2016, the PBOC started to raise the interbank rates to tighten policies. Ten-year yields steadily increased, rising above 4% by November 2017, after bottoming at about 2.7% in August 2016. This time, while expectations for an immediate RRR cut have waned, most economists still expect some form of easing is warranted in coming months. The risk to the consensus thinking, however, is that Beijing’s tolerance for slower growth may be higher than before. The fact that China is pushing forward with the property tax despite the housing slowdown underscores Beijing’s focus on the quality over quantity of GDP. And the authoritative person made sure that message is coming across. (This story was originally published as Tuesday’s ‘China Today’ column. For more, including to subscribe, click {NI CHTODAY <GO>}) — With assistance by Amy Li Before it's here, it's on the Bloomberg Terminal. LEARN MORE

To: ggersh who wrote (179649)

10/26/2021 9:01:21 AM

From: TobagoJack

2 Recommendations

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Common-prosperity at work, by gentle persuasion:0)

Capitalism, with unlimited liabilities, the old fashioned way, per meritocracy

bloomberg.com

China Urges Evergrande Founder to Pay Debt With Personal Wealth

October 26, 2021, 6:02 PM GMT+8

Hui Ka Yan Photographer: Paul Yeung/BloombergChinese authorities told billionaire Hui Ka Yan to use his personal wealth to alleviate China Evergrande Group’s deepening debt crisis, according to people familiar with the matter.

Beijing’s directive to the Evergrande founder came after his company missed an initial Sept. 23 deadline for a coupon payment on a dollar bond, said the people, asking not to be identified discussing a private matter. Local governments across China are monitoring Evergrande’s bank accounts to ensure company cash is used to complete unfinished housing projects and not diverted to pay creditors, the people said.

The demand that Hui tap his own fortune to pay Evergrande’s debt adds to signs that Beijing is reluctant to orchestrate a government rescue, even as the property giant’s crisis spreads to other developers and sours sentiment in the real estate market. Chinese President Xi Jinping has been cracking down on the billionaire class as part of his “common prosperity” campaign to reduce the country’s yawning wealth gap.

It’s unclear whether Hui’s fortune is big and liquid enough to make a sizable dent in Evergrande’s liabilities, which swelled to more than $300 billion as of June. The developer’s dollar bonds are trading at deep discounts to par value as investors brace for what could be one of China’s largest-ever debt restructurings.

Hui’s net worth has dwindled to about $7.8 billion from $42 billion at its peak in 2017, according to Bloomberg Billionaires Index estimates. But the figure comes with considerable uncertainty.

Much of Hui’s known wealth is derived from his controlling stake in Evergrande and the cash dividends he’s received from the company since its 2009 listing in Hong Kong. Hui has pocketed about $8 billion over the past decade thanks to Evergrande’s generous payouts, according to Bloomberg calculations. It’s not known how Hui reinvested those dividends.

Read more...

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Hui didn’t immediately reply to a request for comment sent through Evergrande. The People’s Bank of China didn’t immediately reply to a request for comment.

Last week Evergrande surprised some China watchers by pulling backfrom the brink of default, paying a $83.5 million coupon to international bondholders before the grace period expired Oct. 23. It’s unclear where the funds came from. Separately, Reuters reported that Hui agreed to put his own money into a Chinese residential project tied to a bond to ensure it’s completed and bondholders get paid.

The next test will be a dollar coupon payment due Oct. 29, when a 30-day grace period ends. A hefty wall of maturing debt awaits in 2022, with some $7.4 billion of onshore and offshore bonds coming due.

There’s been little help from asset sales in recent months even after Hui put stakes in once-prized arms such as his electric vehicle and bottled water units on the block. Evergrande said last Wednesday it scrapped talks to offload a stake in its property-management arm. The deal fell apart even after officials in Evergrande’s home province of Guangdong helped broker the talks, a person with knowledge of the matter has said.

As recently as a year ago, such support -- and help from Hui’s wealthy friends -- was enough to see the company through a liquidity crunch, when it failed to secure a backdoor listing for its mainland unit. Now, Hui’s empire is turning into one of the biggest victims of President Xi’s efforts to curb the debt-fueled excesses of conglomerates and defuse risks in the housing market.

Evergrande and its affiliated companies were built through an aggressive mix of debt issuance, share sales, bank loans and shadow financing -- funding avenues that have been largely cut off under the crackdown.

The Ministry of Housing and Urban-Rural Development instructed local subsidiaries across China in August to supervise funds for Evergrande’s property projects in special escrow accounts, people familiar said. Under the heightened oversight, the developer’s funds must first be used for construction to ensure project delivery, the people said.

Evergrande has yet to finish homes for 1.6 million buyers who have already put down deposits. Its real estate sales plunged about 97% during peak home-buying season, further crimping its ability to generate funds.

The firm’s troubles are infecting the broader housing market. Sentiment among buyers is evaporating and, in September, prices began falling for the first time in six years.

China’s banking regulator last week vowed to keep its curbs on the nation’s property market, even though the policies have weighed on indebted developers. While officials have told banks to speed up mortgage lending again, the central bank has indicated that contagion risks from Evergrande are “controllable” and unlikely to spread.

— With assistance by John Liu, and Russell Ward

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