They're carefully trying to change ownership of the hot potatoes so that as many of them are in foreign hands as possible. If Evergrande defaults, foreign bond

They're carefully trying to change ownership of the hot potatoes so that as many of them are in foreign hands as possible. If Evergrande defaults, foreign bondholders will claim their collateral. So instead, for example, they have state-owned companies buying up Evergrande's assets, then Evergrande using that money to pay back local creditors, so that Evergrande is eventually left owning neither money nor assets to pay back foreign bondholders. Nothing left to seize in court. Meanwhile, they are trying not to create a shock in real-estate prices that would undermine the other overleveraged developers, such as would occur if Evergrande unloaded all of their assets at once. Each developer is balancing their debt-to-asset ratio, so if their real estate assets drop in paper value, they end up in Evergrande's position. Foreign bondholders appear to be playing along with this, which is fascinating; it suggests that either those bondholders are, too, looking to offload their hot potatoes and want to preserve the appearance that they're still worth something as they search for buyers, or else they're using those bonds as collateral for their own loans. As long as credit rating agencies play along and don't drop the credit rating to full default, they may be able to do so.