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Some real estate related news from China: - Country garden, China's second biggest property company after Evergrande, missed a mere 22.5M payments for dollar d

Some real estate related news from China: - Country garden, China's second biggest property company after Evergrande, missed a mere 22.5M payments for dollar denominated bonds. It is trying to restructure a $340B debt owned. https://abcnews.go.com/Business/wireStory/chinas-government-defuse-economic-fears-after-real-estate-102332535 https://abcnews.go.com/Business/wireStory/chinas-government-... - Li Ka Shing, richest man in Hong Kong, just offered an immediate 30% off on his newest buildings for sale - One of China's biggest shadow banks skipped payment. These shadow banks provide liquidity to real estate companies, in short. https://www.bloomberg.com/news/articles/2023-08-16/chinese-shadow-bank-misses-dozens-of-payments-as-fallout-spreads https://www.bloomberg.com/news/articles/2023-08-16/chinese-s... Some economic related news from China: - China stopped reporting youth unemployment, estimated around 20-50%. Which is why nobody really thinks China is growing at 5%. https://www.washingtonpost.com/world/2023/08/15/china-economy-youth-unemployment-rate/ https://www.washingtonpost.com/world/2023/08/15/china-econom... - foreign investment fell down 87% from the same period last year, lowest level in 25 years. https://www.bloomberg.com/news/articles/2023-08-07/china-foreign-investment-gauge-at-25-year-low-amid-high-tensions?in_source=embedded-checkout-banner https://www.bloomberg.com/news/articles/2023-08-07/china-for... - China's fertility rate dropped to record low 1.09 in 2022 https://www.reuters.com/world/china/chinas-fertility-rate-drops-record-low-109-2022-state-media-2023-08-15/ https://www.reuters.com/world/china/chinas-fertility-rate-dr... - China records fewest marriages in more than 3 decades https://www.cnn.com/2023/06/12/china/china-marriages-record-low-intl-hnk/index.html https://www.cnn.com/2023/06/12/china/china-marriages-record-... - China's exports fell by 14.5% in July from a year ago, while imports dropped by 12.4% https://www.cnbc.com/2023/08/08/china-reports-double-digit-plunge-in-july-exports-and-imports-missing-expectations.html https://www.cnbc.com/2023/08/08/china-reports-double-digit-p... - China's economy slipped into deflation https://www.bbc.com/news/business-66435870 https://www.bbc.com/news/business-66435870

whimsicalism 3y ago
Yes, it is not looking good for their outlook. That said, nobody is seriously claiming Chinese youth unemployment at 50% unless you are looking at something like labor force participation rate, which is then a similar number for the US as well.
- anonylizard 3y ago
  No, it can actually be 50%. Why do you think that's not serious? Greek youth unemployment was at 60% during their peak debt crisis. China's mega debt tsunami is starting to slam the shores right now. China already tried its hardest to suppress youth unemployment rates. Student councillors in China are given strict KPIs to ensure their students graduate with a job. So obviously they co-operate with shady companies that give out sham employment contracts, and then pressure the student to sign, all to give out an impression of 'graduate employment' China faces a severe crisis of over-education. China educated many university graduates, but has no industry to actually absorb them (Many such industries were crushed by the government, such as gaming, tech, or education). China's factories desperately need cheap labour (and are starting to lose competitiveness because of this), but the over-educated grads are absolutely unwilling to go back to the factory floor like their parents. So you have millions of grads all dreaming of sitting in a prestigious office job, where none exists, so instead they all compete for government jobs, where there's 1 role for 100 applicants. The Chinese government is already enforcing a streaming system in middle school, with at most 50% of students going to high school, rest going into technical education, but its too little too late.
  - expertentipp 3y ago
    Don't know about China and your country, but in my country they resolved unemployment rates by limiting the number of tickets that the ticketing machines print in every unemployment office. Now unemployment numbers are record low.
  - whimsicalism 3y ago
    that’s a lot of words to not cite a single person saying 50%
  - slushh 3y ago
    If they have many university graduates and lack cheap labour, why don't they let those graduates build robots or organize the outsourcing of the labour into countries with cheap labour? How can there be a surplus of educated people who are unable to organize something profitable?
deleted 3y ago
[deleted]
CamperBob2 3y ago
Ka Shing, richest man in Hong Kong Talk about nominative determinism...
- satvikpendem 3y ago
  I wonder how nominative determinism works across languages. Given enough languages and names, one is bound to come up with any number of people whose life is nominatively determined.
  - abwizz 3y ago
    not unlike star signs
    - satvikpendem 3y ago
      Indeed, so not worth taking seriously. ND is a fun little observation though, when it does happen from time to time.
      - Tade0 3y ago
        I have an uncommon name for someone of my generation and the net effect is that people would often take me for someone more sophisticated than I am in reality.
midoridensha 3y ago
>- China's fertility rate dropped to record low 1.09 in 2022 >- China records fewest marriages in more than 3 decades Wow, at this rate, they might just overtake South Korea for lowest birth and marriage rates within the decade.
- jimbob45 3y ago
  Wow, I thought you were making that up. It’s real. Why not just repeal the child limitations then? No reason to keep them in place if the rate is that low.
  - BossingAround 3y ago
    If you're talking about the one-child policy, that has been repealed in 2016.
    - worrycue 3y ago
      That's kind of late ... Wasn't anyone there keeping an eye on the birthrate?
      - swexbe 3y ago
        Bad policy tends to stick around for longer when you don't allow criticism of the ruling elite.
      - mensetmanusman 3y ago
        Not if your paycheck is enhanced by keeping quiet.
      - BossingAround 3y ago
        I see you haven't encountered authoritarian regimes very much.
  - deleted 3y ago
    [deleted]
  - 3y ago
_hypx 3y ago
The economic crisis has been brewing for a long time. No country can just ignore basic economics forever. They have been living off of borrowed time (and borrowed money) for a while now. The bill will come due soon. This is eerily similar to what happened to Japan in the 1990s.
tjpnz 3y ago
Government control over reproduction leads to unintended consequences? Who would've seen that coming?
- satvikpendem 3y ago
  Fertility rate across the world is dropping even without government intervention. Who knew having a higher standard of living means you don't need as many kids to work the farm, and indeed, that people simply don't want to give up that lifestyle in order to have kids?
  - The_Colonel 3y ago
    Yes, but the fertility rate drop is just too fast in China. There will be way too many old people requiring care for too few people in the productive age. Smaller rich countries can solve this problem by importing young workers from poor countries. But on China's scale of 1.5B people that's not really feasible. (China also isn't really that rich on average, isn't attractive for immigrants and isn't culturally welcoming to immigrants)
- jeswin 3y ago
  It's not automatically a bad thing. China has done fantastically well economically, and in terms of health care, education etc. There are other countries which have had strict population control and have done well economically - such as Singapore, South Korea. I see nothing wrong with poorer countries keeping restrictions on population growth - so that they can increase the standard of living and make sure everyone gets education and healthcare.
  - jskrablin 3y ago
    It may work in short term but then you run out of population in long term. And suddenly any gains from short term improvement is under a big question mark.
    - blackoil 3y ago
jimmySixDOF 3y ago
I heard someone on the radio recently speculate that due to the political climate China could prefer and produce a Japanese style decades long unwinding of economic bubbles vs a western style resolution through crisis. Of interest also was the level of Municipal debt and it's stratification between provincial higher default risks and a handful of real high flyers.
- zpeti 3y ago
  Except they will be doing this at a much lower economic situation than Japan. Japan still got to being a first world country, but then busted. China won’t get there.
  - throwaway2037 3y ago
    Why was this downvoted? There is plenty of truth here.
  - The_Colonel 3y ago
    Japanese demographics were also much more stable (even if low in general). China will have a much more dramatic demographic shift. The fertility rate was ~6 in 1970, ~2.8 in 1980 ... 1.09 in 2022. These strong generations will continue retiring, but there will be few young workers to replace them.
  - bohadi 3y ago
    Don't know where you're from or your experience but you maybe want to update your priors on the meaning term first world, which peaked in usage roughly 1948... https://books.google.com/ngrams/graph?content=first+world&year_start=1800&year_end=2019&corpus=en-2019&smoothing=3 https://books.google.com/ngrams/graph?content=first+world&ye... The mean and median living some places might surprise you. For example visit HongKong, Singapore, Taipei, Tokyo, or a mainland city this millenium. Or dont'! First world, it mostly conjures automobile culture and car infrastructure which is nothing special these days but check the world's largest car makers... you would guess Germany Japan or even the USA recently no?
renegade-otter 3y ago
"China's sliding yuan could be next 'black swan event' for markets, hedge fund EDL says": https://www.reuters.com/markets/currencies/chinas-sliding-yuan-could-be-next-black-swan-event-markets-hedge-fund-edl-says-2023-08-17/ https://www.reuters.com/markets/currencies/chinas-sliding-yu... It would be interesting to see the blast radius, specifically in terms of countries like Russia, which is becoming increasingly dependent on the yuan as it is exiting its relations with the West , huffing and puffing: https://carnegieendowment.org/politika/88926 https://carnegieendowment.org/politika/88926
- Havoc 3y ago
  > the blast radius, Global economy is the blast radius. China is the biggest economy by trade so it’ll ripple through everything
  - tacker2000 3y ago
    Could be, but the effects wont be so pronounced anymore i think. The biggest ripples have already passed through during covid and the time after. The covid induced shortages like stock shortages, chip shortages, container shortage etc have already been dealt with and lots of companies have reduced their dependencies on china, etc…
FreshStart 3y ago
Missing : real estate invested missing money into sprawling conglomerates. E-car brands and other industries.
deleted 3y ago
[deleted]
throwaway2037 3y ago
SCMP says CKC Holdings only reduced prices by 16% on less than 300 units in a single building in a non-premium location. The 30% figure only comes from shitty, click baity "news" sources. Property analysts felt that 16% cut was in line with the market. No one with deep understanding of that market is clutching their pearls too tight.
eunos 3y ago
> China stopped reporting youth unemployment, estimated around 20-50% youth unemployment data is just another toxic data that rarely used before in China and others just like "Total Debt" metrics that only used against China for some reason. > China's economy slipped into deflation Mainly caused by normalizing pork price, last year it went wild due to swine flu.
- worrycue 3y ago
  > Mainly caused by normalizing pork price, last year it went wild due to swine flu. Seriously? One food can cause the entire economy to slip into deflation?
  - eunos 3y ago
    Pork price is a huge component of Chinese CPI. Also the price reductions were massive, like double digit huge. https://www.cnbc.com/2023/08/09/china-reports-smaller-than-expected-drop-in-consumer-prices.html https://www.cnbc.com/2023/08/09/china-reports-smaller-than-e... "A 26% year-on-year drop in pork prices, a staple food in China, contributed to the overall decline in the CPI in July"
NovaDudely 3y ago
To soften this a little bit, and I mean a very little. The youth unemployment numbers are hard to judge, could be right but it is hard to tell on the outside. The fertility figures are a long term issue, China is not alone in that but something to keep an eye on. Those import/export figures... now that is the the most telling of how the economy is fairing nowadays. For all the speculation I have heard for decades, that is the most alarming stat I have seen. That is where the rubber meets the road for an economy that is so depended on those things to keep society function vaguely well. Stay tuned...

whimsicalism 3y ago

Yes, it is not looking good for their outlook. That said, nobody is seriously claiming Chinese youth unemployment at 50% unless you are looking at something like labor force participation rate, which is then a similar number for the US as well.

anonylizard 3y ago
No, it can actually be 50%. Why do you think that's not serious? Greek youth unemployment was at 60% during their peak debt crisis. China's mega debt tsunami is starting to slam the shores right now. China already tried its hardest to suppress youth unemployment rates. Student councillors in China are given strict KPIs to ensure their students graduate with a job. So obviously they co-operate with shady companies that give out sham employment contracts, and then pressure the student to sign, all to give out an impression of 'graduate employment' China faces a severe crisis of over-education. China educated many university graduates, but has no industry to actually absorb them (Many such industries were crushed by the government, such as gaming, tech, or education). China's factories desperately need cheap labour (and are starting to lose competitiveness because of this), but the over-educated grads are absolutely unwilling to go back to the factory floor like their parents. So you have millions of grads all dreaming of sitting in a prestigious office job, where none exists, so instead they all compete for government jobs, where there's 1 role for 100 applicants. The Chinese government is already enforcing a streaming system in middle school, with at most 50% of students going to high school, rest going into technical education, but its too little too late.
- expertentipp 3y ago
  Don't know about China and your country, but in my country they resolved unemployment rates by limiting the number of tickets that the ticketing machines print in every unemployment office. Now unemployment numbers are record low.
- whimsicalism 3y ago
  that’s a lot of words to not cite a single person saying 50%
- slushh 3y ago
  If they have many university graduates and lack cheap labour, why don't they let those graduates build robots or organize the outsourcing of the labour into countries with cheap labour? How can there be a surplus of educated people who are unable to organize something profitable?

deleted 3y ago

[deleted]

CamperBob2 3y ago

Ka Shing, richest man in Hong Kong Talk about nominative determinism...

satvikpendem 3y ago
I wonder how nominative determinism works across languages. Given enough languages and names, one is bound to come up with any number of people whose life is nominatively determined.
- abwizz 3y ago
  not unlike star signs
  - satvikpendem 3y ago
    Indeed, so not worth taking seriously. ND is a fun little observation though, when it does happen from time to time.
    - Tade0 3y ago
      I have an uncommon name for someone of my generation and the net effect is that people would often take me for someone more sophisticated than I am in reality.

midoridensha 3y ago

>- China's fertility rate dropped to record low 1.09 in 2022 >- China records fewest marriages in more than 3 decades Wow, at this rate, they might just overtake South Korea for lowest birth and marriage rates within the decade.

jimbob45 3y ago
Wow, I thought you were making that up. It’s real. Why not just repeal the child limitations then? No reason to keep them in place if the rate is that low.
- BossingAround 3y ago
  If you're talking about the one-child policy, that has been repealed in 2016.
  - worrycue 3y ago
    That's kind of late ... Wasn't anyone there keeping an eye on the birthrate?
    - swexbe 3y ago
      Bad policy tends to stick around for longer when you don't allow criticism of the ruling elite.
    - mensetmanusman 3y ago
      Not if your paycheck is enhanced by keeping quiet.
    - BossingAround 3y ago
      I see you haven't encountered authoritarian regimes very much.
- deleted 3y ago
  [deleted]
- 3y ago

_hypx 3y ago

The economic crisis has been brewing for a long time. No country can just ignore basic economics forever. They have been living off of borrowed time (and borrowed money) for a while now. The bill will come due soon. This is eerily similar to what happened to Japan in the 1990s.

tjpnz 3y ago

Government control over reproduction leads to unintended consequences? Who would've seen that coming?

satvikpendem 3y ago
Fertility rate across the world is dropping even without government intervention. Who knew having a higher standard of living means you don't need as many kids to work the farm, and indeed, that people simply don't want to give up that lifestyle in order to have kids?
- The_Colonel 3y ago
  Yes, but the fertility rate drop is just too fast in China. There will be way too many old people requiring care for too few people in the productive age. Smaller rich countries can solve this problem by importing young workers from poor countries. But on China's scale of 1.5B people that's not really feasible. (China also isn't really that rich on average, isn't attractive for immigrants and isn't culturally welcoming to immigrants)
jeswin 3y ago
It's not automatically a bad thing. China has done fantastically well economically, and in terms of health care, education etc. There are other countries which have had strict population control and have done well economically - such as Singapore, South Korea. I see nothing wrong with poorer countries keeping restrictions on population growth - so that they can increase the standard of living and make sure everyone gets education and healthcare.
- jskrablin 3y ago
  It may work in short term but then you run out of population in long term. And suddenly any gains from short term improvement is under a big question mark.
  - blackoil 3y ago

jimmySixDOF 3y ago

I heard someone on the radio recently speculate that due to the political climate China could prefer and produce a Japanese style decades long unwinding of economic bubbles vs a western style resolution through crisis. Of interest also was the level of Municipal debt and it's stratification between provincial higher default risks and a handful of real high flyers.

zpeti 3y ago
Except they will be doing this at a much lower economic situation than Japan. Japan still got to being a first world country, but then busted. China won’t get there.
- throwaway2037 3y ago
  Why was this downvoted? There is plenty of truth here.
- The_Colonel 3y ago
  Japanese demographics were also much more stable (even if low in general). China will have a much more dramatic demographic shift. The fertility rate was ~6 in 1970, ~2.8 in 1980 ... 1.09 in 2022. These strong generations will continue retiring, but there will be few young workers to replace them.
- bohadi 3y ago
  Don't know where you're from or your experience but you maybe want to update your priors on the meaning term first world, which peaked in usage roughly 1948... https://books.google.com/ngrams/graph?content=first+world&year_start=1800&year_end=2019&corpus=en-2019&smoothing=3 https://books.google.com/ngrams/graph?content=first+world&ye... The mean and median living some places might surprise you. For example visit HongKong, Singapore, Taipei, Tokyo, or a mainland city this millenium. Or dont'! First world, it mostly conjures automobile culture and car infrastructure which is nothing special these days but check the world's largest car makers... you would guess Germany Japan or even the USA recently no?

renegade-otter 3y ago

"China's sliding yuan could be next 'black swan event' for markets, hedge fund EDL says": https://www.reuters.com/markets/currencies/chinas-sliding-yuan-could-be-next-black-swan-event-markets-hedge-fund-edl-says-2023-08-17/ https://www.reuters.com/markets/currencies/chinas-sliding-yu... It would be interesting to see the blast radius, specifically in terms of countries like Russia, which is becoming increasingly dependent on the yuan as it is exiting its relations with the West , huffing and puffing: https://carnegieendowment.org/politika/88926 https://carnegieendowment.org/politika/88926

Havoc 3y ago
> the blast radius, Global economy is the blast radius. China is the biggest economy by trade so it’ll ripple through everything
- tacker2000 3y ago
  Could be, but the effects wont be so pronounced anymore i think. The biggest ripples have already passed through during covid and the time after. The covid induced shortages like stock shortages, chip shortages, container shortage etc have already been dealt with and lots of companies have reduced their dependencies on china, etc…

FreshStart 3y ago

Missing : real estate invested missing money into sprawling conglomerates. E-car brands and other industries.

deleted 3y ago

[deleted]

throwaway2037 3y ago

SCMP says CKC Holdings only reduced prices by 16% on less than 300 units in a single building in a non-premium location. The 30% figure only comes from shitty, click baity "news" sources. Property analysts felt that 16% cut was in line with the market. No one with deep understanding of that market is clutching their pearls too tight.

eunos 3y ago

> China stopped reporting youth unemployment, estimated around 20-50% youth unemployment data is just another toxic data that rarely used before in China and others just like "Total Debt" metrics that only used against China for some reason. > China's economy slipped into deflation Mainly caused by normalizing pork price, last year it went wild due to swine flu.

worrycue 3y ago
> Mainly caused by normalizing pork price, last year it went wild due to swine flu. Seriously? One food can cause the entire economy to slip into deflation?
- eunos 3y ago
  Pork price is a huge component of Chinese CPI. Also the price reductions were massive, like double digit huge. https://www.cnbc.com/2023/08/09/china-reports-smaller-than-expected-drop-in-consumer-prices.html https://www.cnbc.com/2023/08/09/china-reports-smaller-than-e... "A 26% year-on-year drop in pork prices, a staple food in China, contributed to the overall decline in the CPI in July"

NovaDudely 3y ago

To soften this a little bit, and I mean a very little. The youth unemployment numbers are hard to judge, could be right but it is hard to tell on the outside. The fertility figures are a long term issue, China is not alone in that but something to keep an eye on. Those import/export figures... now that is the the most telling of how the economy is fairing nowadays. For all the speculation I have heard for decades, that is the most alarming stat I have seen. That is where the rubber meets the road for an economy that is so depended on those things to keep society function vaguely well. Stay tuned...