- namaste friends
- Sep 18, 2004
-
by Smythe
|
wrong thread
|
#
¿
Oct 10, 2016 05:34
|
|
- Adbot
-
ADBOT LOVES YOU
|
|
|
#
¿
May 11, 2024 06:24
|
|
- namaste friends
- Sep 18, 2004
-
by Smythe
|
https://twitter.com/WorthWray/status/786007683539177472?s=09
This Chinese debt bubble can't be bailed out by reserves can it?
|
|
#
¿
Oct 12, 2016 03:37
|
|
- namaste friends
- Sep 18, 2004
-
by Smythe
|
http://mobile.nytimes.com/2016/10/17/business/international/china-home-price-bubble.html?smid=tw-share&referer=https://t.co/u5uFtrHd1P
quote:
China Property Boom Spurs Fear of Bubble’s Burst
SHANGHAI — Zheng Ruizhen counted herself among the last holdouts on Lufeng Road.
Even as high-rises sprang up in recent years to surround her dilapidated home, Ms. Zheng, a 50-year-old schoolteacher, and her husband, Sun Guojian, held firm. He grew up there. Her school was a 20-minute bicycle ride away. They raised their son there, though he eventually grew so tall that his head grazed the ceiling of his cramped room. When city officials pushed them to sell, they said no.
Then came China’s latest property bubble — a frothy surge in prices that could have global repercussions if it pops.
In August, an unremarkable piece of land around the corner from Ms. Zheng sold for nearly $2,000 a square foot, a national record and nearly three times the average land price in Manhattan. Local officials grew more insistent and threatened to tear down their bathroom.
Finally, they relented, and Ms. Zheng’s husband signed away the home for a price to be determined later. Then, on Oct. 9, Mr. Sun died of a heart attack, something Ms. Zheng said was perhaps influenced by stress over the pending demolition of their home.
Now, as she grieves, she is waiting to hear how much the Shanghai government will offer in compensation — but however much that is, she knows it will not be enough for her to be able to afford to live anywhere close to Lufeng Road.
Said Ms. Zheng: “I never expected housing prices in Shanghai would get this high.”
China is in the midst of a dizzying housing bubble. Shanghai’s average housing price is up nearly one-third from a year ago, with prices in major cities like Beijing and Guangzhou not far behind. Chinese consumers are rushing to buy homes before the government steps in with restrictions.
When rumors swept through Shanghai that the government would require homeowners to pay more in taxes and down payments to buy additional properties, many couples filed for divorce so that one partner could still be treated as an independent buyer.
China has experienced housing booms and busts before. And fervor for real estate among the wealthiest Chinese has already spread far beyond the country’s borders, from Long Island mansions to disused ranches in Texas — many to get their money out of the country.
But economists warn that the current boom on the Chinese mainland could be extra difficult to resolve: It comes with a growing amount of American-style debt.
Long-term household loans — mostly mortgages — have doubled as a share of total official bank lending this year. They accounted for about 40 percent of all new loans in August, contrasted with just 20 percent at the start of the year. The value of new home loans as a percentage of all housing sales has surged to a record high.
The loans — largely a byproduct of a flood of Chinese lending to keep the economy growing — are helping the affluent, the middle class and low earners who have dreamed of owning a home, while investors and speculators are piling in, too. Underground lenders — those who operate outside the formal banking system using a variety of new platforms — are also helping to feed the boom.
Last month, economists at the Bank of China warned in a report that worsening asset price bubbles were adding to a frothy market that could result in trouble. The day before, Wang Jianlin, a politically connected property and entertainment magnate who is one of the country’s richest people, told CNN that China property was “the biggest bubble in history.”
That could be bad news for the global economy. Many economists estimate that housing and related areas — like construction, cement manufacturing or furniture making — account for roughly one-fifth of China’s economic activity. But if the bubble pops, that support could disappear quickly.
Chinese officials, apparently mindful of the 2008 American housing bust, appear to be aware of the risks of a debt-fueled property bubble. But some economists worry they will be too slow to rein it in.
“The risk is that the government is late in cooling the market, the rally spreads to more areas, pushing up household leverage and construction activity, pushing the bubble bigger, which is then followed by a bigger downward correction,” said Tao Wang, the head of China economics at UBS in Hong Kong.
Local regulators are already trying to cool things down. In the last few weeks, local authorities have accelerated efforts to tighten housing markets in up to 20 Chinese cities, according to economists at China International Capital Corporation, an investment bank.
But in many cases these steps have only added to the rush, as home buyers move in while they can.
By her account, Zhang Xia and her husband have enjoyed a happy marriage. Then the rumor swept the city that Shanghai authorities would make it harder for couples with one home to buy more.
On a recent Monday, Ms. Zhang, a 40-year-old resident of Shanghai’s Huangpu area, and her husband sat waiting at a local marriage registry office to file for divorce. Shanghai officials continue to deny that they will limit house buying by couples, but Ms. Zhang is among many who do not believe them.
“We know the government said this is a rumor, but they also said that a few times before, when the rumor actually came true,” Ms. Zhang said. “Some people even said the fact that the government said it’s a rumor means it’s going to be true.”
Shanghai, China’s financial capital, is at the heart of the property boom. Demand there is so intense that developers now commonly require sizable deposits of cash just to join a lottery to buy a new apartment. Only holders of winning numbers will be offered the chance to buy a unit. One flashy new development in central Shanghai charges a refundable 200,000 renminbi, or $30,000, to enter its lottery.
“In Shanghai now,” said Wang Jie, a sales manager there, “it’s not like you can buy an apartment just because you have money.”
Back on Lufeng Road, the recently widowed Ms. Zheng and her neighbors try to go about their lives despite the boom going on around them. Men and women play mah-jongg near a half-demolished house, one of a number of dwellings along the road in various states of disassembly, like a row of rotting teeth. Stray dogs sunbathe and alley cats hunt around piles of red bricks and wooden beams scattered on the street.
In recent months, local officials hung red propaganda banners on people’s housing extolling the benefits of selling out. “No more hesitation means no more disappointment,” reads one. Says another: “Requisition and compensation are lawful. Smart alecks will regret it later.”
“Look at those banners,” Ms. Zheng said, shaking her head. “It’s almost like the Cultural Revolution once again.”
Earlier, local officials told Ms. Zheng that the land where her home stands would be used to build supporting facilities for the next-door complex of high-rises built by China Vanke, the country’s largest property developer.
“They said that when people who live in the high-rises in Vanke look down, the view from their windows is our ugly roofs,” she said. “So they have to get rid of us.”
|
|
#
¿
Oct 17, 2016 04:07
|
|
- namaste friends
- Sep 18, 2004
-
by Smythe
|
Any updates?
|
|
#
¿
Dec 5, 2016 23:50
|
|
- namaste friends
- Sep 18, 2004
-
by Smythe
|
They sure picked a helluva day to gently caress this up
|
|
#
¿
Dec 5, 2016 23:56
|
|
- namaste friends
- Sep 18, 2004
-
by Smythe
|
And the whole Italian referendum
|
|
#
¿
Dec 6, 2016 00:07
|
|
- namaste friends
- Sep 18, 2004
-
by Smythe
|
quote:
As China’s Jia Yueting expanded his tech empire, he wasn’t shy about critiquing industry giants. In his first international TV appearance in April, the 43-year-old billionaire called Apple Inc. “outdated” and its innovation “extremely slow.” As for Tesla Motors Inc., he later said it may be a “great” company, but he aimed to surpass Elon Musk and “lead the industry leapfrogging to a new age."
What a difference a few months make. Jia admitted in a memo to employees last month that his LeEco holding company had expanded too aggressively into smartphones, electric cars and other ventures, and was struggling to raise the cash it needed. Jia cut his own salary to 1 yuan (15 cents) and warned of hard days to come. “We blindly sped ahead, and our cash demand ballooned," he wrote. "We got over-extended in our global strategy.”

Jia Yueting
Photo by: Photographer: David Paul Morris/Bloomberg
Jia Yueting
Photographer: David Paul Morris/Bloomberg
Now, the cash crunch is spreading. Two Taiwanese suppliers to LeEco hardware divisions have warned the company is behind on its payments. Another supplier, MediaTek Inc., has been demanding cash before delivering products to the company, according to a person familiar with the matter. As for the electric-car division that was supposed to challenge Tesla, the construction contractor building its $1 billion plant in Nevada has suspended work after more than $20 million in missed payments.
The foundation of Jia’s empire looks shaky too. He made his fortune from an online video business called Leshi Internet Information & Technology Corp., a Chinese version of Netflix that’s worth more than $10 billion. But Jia used his stake in Leshi as collateral to borrow billions and fund his expansion. Leshi’s stock has plummeted recently, raising the prospect Jia will have to come up with more cash, sell assets or see his loans called back. Leshi suspended its stock from trading on Wednesday in Shenzhen as the company checks on its share drop and reports on Jia’s loans.
"The entire ecosystem has just burned too much money," said Ray Zhao, an analyst at Guotai Junan Securities. Jia has been effective at concocting shiny visions of future opportunities but lacks the funding to execute, he said. “All these businesses need money.”
Jia, LeEco and Leshi declined to comment for this story. Jia said in the memo to employees and local press interviews that the company’s funding problems are a temporary setback that will be overcome in the next two years as various businesses are restructured to generate cash.
Dan Schwartz, the Nevada Treasurer, has questioned Jia’s plans for the electric-car plant there. He thinks the billionaire’s strategy of borrowing to finance so many new businesses so quickly is unsustainable. “This is all Fantasyland,” he said. "The best analogy is the Emperor’s New Clothes. There’s nothing there.”

Jia grew up in the northern Chinese province of Shanxi and got his start working at a local tax bureau. By 2004 he’d founded Leshi, whose popularity and subsequent public stock sale in 2010 generated the riches to finance dozens of other startups. Jia built a sprawling empire involved in everything from smartphones and electric cars to organic food and movie productions.
Despite his recent challenges, Leshi’s video business continues to grow rapidly as more Chinese watch television shows, movies and short clips online. Revenue is projected to soar 80 percent this year to 23.4 billion yuan, while net income climbs 37 percent to 783.3 million yuan ($114.2 million), according to estimates compiled by Bloomberg. Competition is heating up in the market as rivals such as search giant Baidu Inc. step up efforts to draw users.
The billionaire has been borrowing against his Leshi shares for years, increasing the number used as collateral as his ambitions have grown. That worked well as long as Leshi’s stock price rose because a block of shares pledged one year would be worth more than the loans the next year.
But as shares have dropped in recent months, the opposite happens: Jia’s collateral becomes worth less and may even fall below the value of his loans. That’s when banks typically require borrowers to come up with more collateral, repay loans or sell off assets.
In Jia’s case, he’d pledged 85 percent of his stake, or 587.2 million shares, as of December 2015, according to company filings. Those shares were worth about $5.4 billion at the time.
But since then, Leshi’s latest financial statements show the amount of shares pledged by Jia has fallen slightly to 571 million shares and the stock has tumbled 39.1 percent, meaning the stake is now worth about $3.0 billion.
Jia and Leshi have not disclosed the terms of his loans. LeEco said after its shares were suspended it was checking the sharp drop in its stock price and multiple reports that a majority of Jia’s shares had fallen below the value of his loans. The company’s statement didn’t address whether Jia is facing a margin call.
“To protect the interests of the company and the investors, the company suspended trading to check the relevant matters,” Leshi said in a statement. “At the same time, the company is currently planning a major event, which is expected to involve the integration of industry resources. This matter carries uncertainties.”
Jia has managed his way through downturns in the past. In September of last year, Leshi’s shares fell even lower than they are now and he avoided having to sell off assets or cut his borrowings. Leshi’s shares were also suspended from trading for six months beginning last December and began trading again without incident.
Jia is a potent fundraiser. In November, he announced a $600 million funding round to cover short-term cash needs. Two of the companies named in the statement then said they weren’t participating. LeEco later said some of the money is coming from executives at those businesses rather than the listed companies.
Meanwhile, signs of trouble are spreading throughout Jia’s empire. Most visible is Coolpad Group Ltd., a once-hot smartphone manufacturer where Jia is chairman and a LeEco affiliate owns 28 percent of the stock. Coolpad’s revenue tumbled in the last year as the company lost ground to local rivals. Its stock fell to the lowest since 2012 this week. LeEco’s cash flow problems may affect Coolpad even though it’s a separate public company, said Joseph Ho, an analyst at GF Securities (Hong Kong).
"I don’t see LeEco’s cash flow situations improving in the near term, and no matter what ambitions it might have, it won’t bring any positive boost to Coolpad," he said.
Coolpad didn’t respond to multiple requests for comment.
LeEco has its own smartphone business that is also struggling. That subsidiary’s market share in China peaked in June and has fallen from 5.9 percent to 3.3 percent in October, according to Counterpoint Research. Its global market share has dropped by nearly half in the same time.
LeEco’s cash crunch could hurt in another way -- its proposed $2 billion acquisition of American TV-maker Vizio. The deal was announced in July but has yet to close. LeEco declined to comment on whether it will now be able to complete the purchase.
That’s not the only acquisition that Jia has announced but not yet closed. In May, Leshi said it would pay 9.8 billion yuan for Le Vision Pictures, the movie distribution and production unit whose investors include some of China’s biggest screen stars and directors. The transaction, to be funded by cash and stock, won’t be completed this year, Leshi said in early November, citing "lower-than-expected" box office sales nationwide.

The fallout is spreading to the U.S. About a year ago, Nevada’s governor approved $335 million in tax breaks and other incentives to attract Jia’s electric-car company, Faraday Future, to North Las Vegas. The vision was that Faraday would build a $1 billion production line and bring 4,500 manufacturing jobs to the state. Twelve months later, little has been finished but the grading and foundation work.
The contractor for the project, AECOM Energy & Construction, notified Faraday in October it was more than $20 million behind in funding an escrow account – and would need to pay a further $25 million by the end of the month or face a possible suspension of construction, according to a letter seen by Bloomberg. The next month, AECOM stopped work on the plant. When approached by Bloomberg News for comment, the contractor issued a statement saying its client now planned to continue work in "early 2017." They did not talk about a lack of funds in the statement.
“Faraday Future had a terrific marketing campaign. People expected they might be a competitor to Tesla," said Damien Ma, associate director at the Paulson Institute in Chicago, who studies Chinese investments in the U.S. "But then the model they unveiled" at last year’s Consumer Electronics Show "was like a futuristic Batmobile – totally unrealistic for the general consumer."

The Faraday Future FFZero1 concept vehicle.
Photo by: Photographer: Qilai Shen/Bloomberg
The Faraday Future FFZero1 concept vehicle.
Photographer: Qilai Shen/Bloomberg
Faraday said this week that it plans to unveil its first commercial vehicle at CES in Las Vegas in January. “Stay in the loop w/ updates” from its newsletter, the company said on its official Twitter account.
As long as LeEco can pay a performance bond of up to $70 million, the state of Nevada has agreed to raise debt that will help pay for infrastructure such as water piping and power lines to the factory.
Nevada Treasurer Schwartz has grown skeptical of Jia’s plans and is reluctant to support it. He has called for the release of due diligence and financial planning documents from both Faraday Future and the state’s governor. If the company gets money from the state but fails to complete construction, Schwartz told Bloomberg News, taxpayers could be left out of pocket.
Eight months after boastful quotes about surpassing Apple’s innovation, Jia is striking a more modest tone. "Everyone knows Leshi is my life,” he said in Chinese during a November interview with Tencent media. “If Leshi dies, my wealth has no meaning and my life has no meaning."
https://www.bloomberg.com/news/arti...m_medium=social
Hey so um, between this motherfucker and anbang, are there any other fuerdai that actually are so called billionaires?
|
|
#
¿
Dec 11, 2016 06:28
|
|
- namaste friends
- Sep 18, 2004
-
by Smythe
|
https://twitter.com/AmyYuanZhuang/status/831322614383702019
Fun to think about. The year of the cock will be the year it all falls apart
|
|
#
¿
Feb 14, 2017 03:04
|
|
- Adbot
-
ADBOT LOVES YOU
|
|
|
#
¿
May 11, 2024 06:24
|
|
- namaste friends
- Sep 18, 2004
-
by Smythe
|
https://www.bloomberg.com/news/articles/2017-06-26/china-s-pension-gap-is-growing-and-nobody-wants-to-talk-about-it
quote:
China's Pension Gap is Growing as Aging Becomes Economic Risk
Demographics suggests China's pension gap is widening
It's no secret that China is an aging society facing a growing pensions bill. Just how much of that bill is unfunded seems to be one though.
It's an increasingly urgent question, as nearly a third of the inhabitants of the world's most populous country will be over 60 years old by 2050, according to United Nations data. By 2015, the pension of each retired resident was borne by the contributions of fewer than three wage-earners, government estimates show.
When China set up the current pension system in early 1990s, a shortfall immediately emerged, as the government began making payments to the already-retired using the current contributions of the working population, without there being any cash pile from the previous generation.
The problem was exacerbated in the late 1990s, when millions of workers at state-owned enterprises were laid off and were offered pensions even though they haven't reached retirement age.
There are a few unofficial estimates of the gap, such as that from Enodo Economics contributor Stuart Leckie, who has advised China's government on the matter. Leckie projects the hole will expand to 1.2 trillion yuan by 2019, weighing on public debt. No official data is available.
Data on the gap isn't available in the National Council for Social Security Fund's annual report. The Ministry of Human Resources and Social Security used to publish a report on China's social insurance in 2014 and 2015, which offered a glimpse into the nation's pension burden, but stopped doing so since 2016. The ministry didn't respond a request for comment.
"The lack of public information on the issue has made tackling it more difficult," says Yang Yansui, a public governance professor at Tsinghua University in Beijing, adding that the gap continues to widen and is more serious in places such as northeast China where state-led enterprises take up a bigger share in the economy.
The dynamic migration triggered by urbanization has led to a noticeable regional diversification in terms of the pension burden.
Pensioners in Guangdong are supported by more than nine working people, as young Chinese rush into the prosperous coastal province, seeking better opportunities and, when they find them, making contributions to the local pension fund.
The ratio of pensioners-to-working is about 1:1.5 in Jilin and Heilongjiang, two provinces in China's northeast rust belt, which has seen population outflows in recent years.
The pension burden adds to the fiscal stress in less-developed provinces and impedes their initiative to catch up with developed areas by improving public services and attracting outside investment.
The government appointed reform-minded official Lou Jiwei to head the National Council for Social Security Fund late last year, a sign that it's serious about dealing with the issue. And this year Premier Li Keqianq committed to transferring some of the profit of state-owned companies to the fund to fill the gap, but so far no updates have been released.
Enodo says the main problem is that the pensioner population will grow rapidly as the workforce dwindles, and that a more structural response than just plugging the hole is needed. "The answer is to raise the low retirement age and let pension funds invest in higher yielding assets," the report argues.
phew, and here I am thinking that the biggest problem is the severe gender imbalan
|
|
#
¿
Jun 27, 2017 04:41
|
|
#
¿
Oct 10, 2016 05:34
