Evergrande owes over $300 billion – to banks and non-bank financial institutions, domestic and international bond holders, suppliers and apartment buyers. It has bank borrowings of $90 billion, including to Agricultural Bank of China, China Minsheng Banking Corp and China CITIC Bank Corp. (reports have 128 banks with exposure). Thousands of suppliers are on the hook for $100 billion.
These types of situations generally prove worse than even the more bearish analysts fear. Assume ugly and messy.
Now that every financial game in America has been rigged to benefit the few at the expense of the many, trust and credibility has evaporated like an ice cube on a summer day in Death Valley.
The next, much bigger test, is dead ahead with the SPY, which is vastly more important:
FEEDWell, there’s no doubt that the idea to short Brazil by way of EWZ has turned into a roaring success. I’d say that, in the weeks ahead, there’s way, way more to go.
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Monetary policy can be implemented through outright purchases or sales of securities, which permanently changes the size of the Federal Reserve’s System Open Market Account (SOMA) portfolio.
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Monetary policy can be implemented through outright purchases or sales of securities, which permanently changes the size of the Federal Reserve’s System Open Market Account (SOMA) portfolio.