From Jamie Powell at FT Alphaville:
In markets, being right early is the same as being wrong. Fortunately for FT Alphaville, the same rule doesn’t apply to journalism.
Back in 2018, FT Alphaville took a look at Evergrande -- China’s largest property developer -- and its ballooning balance sheet, which included 408,000 car parking spaces, a land bank the size of Malta, and a curiously low yield on its rental properties.
Three short years later, Evergrande is facing a liquidity crisis. In a normal economy, this wouldn’t be such a big deal. But in China, where real estate is estimated to account for up to a quarter of GDP, this is slightly more of a concern. It doesn’t help that the property developer also has some $300bn of outstanding obligations to pay. And it’s crunch time: two interest payments on its long-suffering bonds are due Thursday.
So the question now is: how contagious would an Evergrande default be for the global economy? Chinese property stocks have started the week by already taking a battering, with Hong Kong listing Sinic Holdings crashing 87 per cent during trading on Monday, and the bonds of other developers sinking to distressed levels. Via UBS:....
....MUCH MORE
Mr. Powell's compadre-in-bisque (the color of the FT is bisque dammit, not pink, not salmon, bisque) the FT's Natural Resources Editor, Neil Hume, has been flagging the downturn in iron ore (as well as keeping track of a couple dozen other things) for the last few weeks
