Over-leveraged Chinese property developer Evergrande slides formally into default.
Fitch Ratings cut Evergrande to “restricted default” over its failure to make two coupon payments by the end of a grace period on Monday, a move that may trigger cross defaults on the developer’s $19.2 billion of dollar debt.
China appears to have adopted the standard Keynesian “remedy” when faced with the implosion of large enterprises: make it even easier for other borrowers to take on debts that they cannot repay.
Policy makers have in recent weeks cut lenders’ reserve requirements, signaled an easing of real estate curbs and rolled out measures to ensure higher-rated developers retain access to funding.
Red China, which does not owe its black soul to western bankers, never failed to make what was technically possible and in the interest of the CCP financially possible.
If Evergrande is failing, it’s because Chairman Xi wants it to fail.
The objective of fascism with Chinese characteristics was never to bring the average Chinaman up to a western living standard honestly. China has ten times the population that could possibly be sustained at a western living standard for any length of time on China’s native resources.
The objective of fascism with Chinese characteristics was to give the CCP the wherewithal to defeat the blue-eyed imperialists in war and kill or enslave them all. Then, and only then, would the Han Chinese be assured of a supply of agricultural land sufficient to guarantee the Chinese self-sufficiency in food.
The CCP now has the capability to release genetically engineered plagues into the environment at will. Wuhan flu was just the warning shot.
Once they have a bug capable of killing or incapacitating most military-age white men in the first wave, Chairman Xi will have much better uses for military-age Han tribesmen than building Potemkin apartment complexes intended purely to provide the illusion of Chinese middle-class prosperity.
The sooner the civilian construction industry collapses, the sooner the PLA will be swimming in recruits with promises of dirt-cheap land and slave girls with big tits waiting to be grabbed with both hands in the future American colonies by those willing to fight for the Emperor.
So don’t laugh too loud. Not while the Chairman is still smiling.
Nailed it, TAT.
The present China Ascendant scenario was all predicted in David Wingrove’s excellent sci-fi series of novels, “Chung Kuo: the Middle Kingdom”.
And in Heinlein’s ‘Sixth Column.’
Yes, All China needs is “A Short Victorious War.”
“Evergrande slides formally into default”
This never gets old:
https://www.youtube.com/watch?v=QxyGaxH6UDQ