MDlaxfan76 wrote: ↑Sun Oct 10, 2021 6:08 pm
Farfromgeneva wrote: ↑Sun Oct 10, 2021 7:00 am
MDlaxfan76 wrote: ↑Sat Oct 09, 2021 8:07 pm
old salt wrote: ↑Sat Oct 09, 2021 7:27 pm
MDlaxfan76 wrote: ↑Sat Oct 09, 2021 7:12 pm
old salt wrote: ↑Sat Oct 09, 2021 7:07 pm
MDlaxfan76 wrote: ↑Sat Oct 09, 2021 6:07 pm
Yes, I do support being a bulwark for Ukraine. Definitely...
I recall you trying to tell us it wasn't really the Russians who crossed the border and took Crimea, then you pivoted to the claim that it was really Russia's in the first place...I recall our argument at that time, the tragic history of appeasement.
I'm still right, IMO.
Listen, if you want to be an isolationist and a nationalist, rejecting international law and organizations, global interdependence, prefer to let other nations deal with their own crises and threats, etc...no sweat, that's simply your opinion (Tulsi's too?)...but how about some actual integrity and consistency to this isolationism?
If you and Tulsi actually believe we should go back to isolationism, then advocate pulling the Navy and Air Force all the way back, abandon all bases around the world, including ME and North Africa...stop messing with what's happening elsewhere, stop striking perceived enemies and simply defend ourselves at home. No more pretending that we need to fight Islamic extremists as if they're actually a bigger threat to America's interests than Russia, China...much less the threat from within. Go ahead and build your wall, keep out all those non-white immigrants...
But be consistent.
We'll disagree.
That part is a fabrication. I never denied that the little green men who seized Crimea were Russians. I pointed out that they received little to no resistance from Ukranian military forces.
My isolationism is non-interventionist. No nation building or wars of choice for human rights abuses or imposing changes in culture.
I support strong naval forces to keep the sea lanes open (with allies) which are vital to our economic survival, robust alliances with fellow democracies & a strong military for deterrence purposes. I support our pivot to Asia to support our Indo-Pacific allies via conventional deterrence. I think we over-invest in defending a wealthy EU from a Russian threat that they do not take seriously, just because we let Putin get under our skin with his political needling. We need to do as much in NATO as our EU allies do, & no more, & focus more on the W Hemisphere & Arctic.
You think we should be a "bulwark" for Ukraine -- whatever that weasel word means.
Should we respond with military force against Russia if they invade Ukraine ? Yes or No ?
Do you think we should respond with military force against China if they invade Taiwan ? Yes or No ?
Yes to both. And we should make that clear, else we're green lighting each.
You and I could agree on some things in terms of priorities, but you lost me with your defense of "nationalism" and "isolationism", historical tragedies again and again, and your denial of what the Russians were trying to do...on behalf of Trump, whose "policies" you supported.
If the citizens of Russia, China, Saudi Arabia, Iraq, Afghanistan, or any other nation choose to live under authoritarian rule -- that's on them, it is their decision.
If we allow ourselves to fall prey to disinformation & propaganda from Russia, China, or any other source, that's on us. We created the social media tools they are using, just as our political parties & commercial influencers use them.
I don't really agree as to the word "choose". Not sure how much "choice" those folks have.
But I do think that ultimately those societies and their governments need to deliver for their people, else they may well overcome the authoritarian system...but that's the point of authoritarian systems, to remove "choice". Whether by force or propaganda, to so thoroughly dominate as to eliminate "choice".
At best, there's a degree of "consent".
China's at least trying to earn the 'consent' through economic growth; Russia has basically given up, just a kleptocracy.
Totally agree as to "on us"...if we allow the Big Lie for instance, if we don't totally reject the Insurrection and don't actually have consequences for those who fomented it, that's "on us".
And our adversaries will be emboldened as we fail to bolster democracy and the rule of law, as well as civility at home.
Managed growth isn’t earning consent. What they did to Jack Ma is so similar to what Putin did to Khodokorsky.
Of course, but it would be naive of us not to recognize that for the masses of Chinese, their lives are progressively getting better at a fast clip, generation over generation. Couple that with media control and constant propaganda...with an already high cultural affinity to community over individual, and they're actually generating a high degree of 'consent' currently.
But it's fragile if they fail to continue to improve the economic wellbeing at a fast clip and/or are demonstrably achieving lower living standards than rivals such as the US with no hope of catching up.
And the 'nationalism' factor will likely be heightened, as will 'control', if they feel that 'consent' to be weakening otherwise...dangerous.
Russia is not achieving that progress, thus is full on with the aggressive nationalism propaganda. And asymmetric cyber warfare. And they're being quite effective in exploiting our system's weaknesses, with a whole bunch of Americans actively being complicit.
And that has the double effect of also making us a weaker competitor to China.
It’s not going to end well for this command and control regime. My concerns about democracy and capitalism being a race to optimize with.l binary outcomes aside, what society that has a ruling class has transitioned to a broader shared equality ever?
Beyond Evergrande, China’s Property Market Faces a $5 Trillion Reckoning
Developers have run up huge debts. Now home sales are down, Beijing is imposing borrowing curbs and buyers are balking at high prices.
By Quentin Webb and Stella Yifan Xie
Oct. 10, 2021 12:07 pm ET
China Evergrande Group, the embattled property developer, is the first high-profile real-estate company to run into serious trouble in Beijing’s campaign to tame a roaring property market.
It might not be the last.
As China enters what many economists say is the final stage of one of the largest real-estate booms in history, it is confronting a staggering bill: More than $5 trillion in debt that developers took on when times were good, according to economists at Nomura Holdings Inc.
That debt is nearly double what it was at the end of 2016 and is more than the entire economic output of Japan, the world’s third-largest economy, last year.
Global markets are braced for a possible wave of defaults, with warning signs flashing over the debt of about two-fifths of development companies that have borrowed from international bond investors.
Chinese leaders are getting serious about addressing the debt, with a series of moves meant to curb excessive borrowing. But doing so without torpedoing the property market, crippling more developers and derailing the country’s economy is quickly turning into one of the biggest economic challenges Chinese leaders have faced in years, and one that could reverberate globally if mismanaged.
Luxury developer Fantasia Holdings Group Co. failed to repay $206 million in dollar bonds that matured Oct. 4. In late September, Evergrande, which has more than $300 billion in obligations, missed two interest-payment deadlines for bonds.
Asia’s junk-bond markets suffered a wave of selling last week. On Friday, bonds from 24 of the 59 Chinese development companies in an ICE BofA index of Asian corporate dollar bonds were trading at yields of above 20%, levels that indicate high risk of default.
Some prospective home buyers are balking, forcing the companies to cut prices to raise cash, and potentially accelerating their slide if the trend continues.
Total sales among China’s 100 largest developers were down by 36% in September from a year earlier, according to data from CRIC, a research unit of property services firm e-House (China) Enterprise Holdings Ltd. It showed that the 10 biggest developers, including China Evergrande, Country Garden Holdings Co. and China Vanke Co. , saw sales down 44% from a year ago.
Economists say that most Chinese developers remain relatively healthy. Beijing also has the firepower and tight control of the financial system needed to prevent a so-called Lehman moment in which a corporate collapse snowballs into a financial crisis, they say.
In late September, The Wall Street Journal reported that China had asked local governments to prepare for problems potentially intensifying at Evergrande.
But many economists, investors and analysts agree that even for healthy ventures, the underlying business model—in which developers use debt to fund a steady churn of new construction despite demographics becoming less favorable for new housing—is likely to change. Some developers might not survive the transition, they say.
Of particular concern is some developers’ practice of relying heavily on “presales,” in which buyers pay in advance for still-uncompleted apartments.
The practice, more common in China than the U.S., means developers are in effect borrowing interest-free from millions of households, making it easier to continue expanding but potentially leaving buyers without finished apartments should the developers fail.
Presales and similar deals were the sector’s biggest funding source this year through August, according to the National Bureau of Statistics of China.
“There is no return to the previous growth model for China’s real-estate market,” said Houze Song, a research fellow at the Paulson Institute, a Chicago think tank focused on U.S.-China relations. He said China is likely to keep in place a set of limits on corporate borrowing it imposed last year, known as the “three red lines,” which helped trigger the recent distress at some developers, though he said China might ease some other curbs.
While Beijing has avoided clear public statements on its plans for dealing with the most indebted developers, many economists believe leaders have no choice but to keep the pressure on them.
Policy makers appear determined to revamp a model driven by debt and speculation as part of President Xi Jinping’s broader efforts to defuse hidden risks that could destabilize society, especially ahead of important Communist Party meetings next year. Mr. Xi is widely expected then to break with precedent and extend his rule into a third term.
Beijing is worried that after years of rapid home-price gains, some people may be unable to get on the housing ladder, potentially fueling social discontent as wealth gaps widen, economists say. Young couples in large cities are beginning to get priced out, making it harder for them to start families. The median apartment in Beijing or Shenzhen now costs more than 40 times the median family annual disposable income, according to J.P. Morgan Asset Management.
Authorities have said they are worried about the property market posing risks to the financial system. Reining in the developers’ business models and limiting debt, however, is almost certain to slow investment and cause at least some downturn in the property market, which is one of the biggest drivers of China’s growth.
The real-estate and construction industries account for a large part of China’s economy. A 2020 paper by researchers Kenneth S. Rogoff and Yuanchen Yang estimated that the industries, broadly construed, accounted for 29% of China’s economic activity, far more than in many other countries. Slower growth in housing could spill into other parts of the economy, affecting consumer spending and employment.
Government statistics show about 1.6 million acres of residential floor space was under construction at the end of last year. That was equal to about 21,000 towers with the floor area of the Burj Khalifa in Dubai, the world’s tallest building.
As restrictions on borrowing imposed last year kicked in, housing construction tumbled in August to 13.6% below its pre-pandemic level, calculations by Oxford Economics show.
The revenue local governments earn by selling land to developers fell by 17.5% in August from a year earlier. Local governments, which are also heavily indebted, count on land sales for much of their revenue.
A further slowdown also would risk exposing banks to more bad loans. Outstanding property loans—primarily mortgages, but also loans to developers—accounted for 27% of China’s total $28.8 trillion in bank loans at the end of June, according to Moody’s Analytics.
As pressure on housing mounts, several research houses and banks have cut China’s growth outlook. Oxford Economics on Wednesday lowered its forecast for China’s third quarter year-on-year gross domestic product growth to 3.6% from 5% previously. It trimmed its 2022 growth forecast for China to 5.4% from 5.8%.
As recently as the 1990s, most of China’s city residents lived in drab dwellings provided by state-owned employers. When market reforms started transforming the country and more people moved to cities, China needed a massive new supply of higher-quality apartments. Private developers stepped in.
Over the years, they added millions of new units in modern, well-maintained high-rises. In 2019, new homes made up more than three-quarters of home sales in China, versus less than 12% in the U.S., according to data cited by Chinese property broker KE Holdings Inc. in a listing prospectus last year.
In the process, the developers became much bigger than anything seen in the U.S. The largest U.S. home builder by revenue, D.R. Horton Inc., reported $21.8 billion of assets at the end of June. Evergrande had some $369 billion. Its assets included vast land reserves and 345,000 unsold parking spaces.
For much of the boom, the developers were filling a need. In more recent years, policy makers and economists began to fret that much of the market was driven by speculation.
Chinese households are restricted from investing abroad, and domestic bank deposits offer low returns. Many people are wary of the country’s boom-and-bust stock markets. So some have poured money into housing, in some cases buying three or four units without any intention of living in them or renting them out.
As developers bought more locations to build on, land sales pumped up national growth statistics. Dozens of entrepreneurs who had founded development companies showed up in lists of Chinese billionaires. Ten of the 16 soccer clubs in the Chinese Super League are wholly or partly owned by developers.
The real-estate giants have borrowed not only from banks but also from shadow-banking outfits known as trust companies and from individuals who put their savings into investments called wealth-management products. Abroad, they became a mainstay of international junk-bond markets, offering juicy yields to get deals done.
One builder, Kaisa Group Holdings Ltd. , defaulted on its debt in 2015, yet was able to keep borrowing and expanding afterward. Two years later it spent the equivalent of $2.1 billion to buy 25 land parcels, and in 2020 spent $7.3 billion for land. This summer, Kaisa sold $200 million of short-term bonds yielding 8.65%.
Nomura estimated that as of June, Chinese developers had racked up debts of $5.2 trillion. It said the biggest share, 46%, was in bank loans. Bond markets accounted for about 10%, including the equivalent of $217 billion of dollar bonds, many of them junk-rated.
By last year, Chinese policy makers had had enough. In August 2020, they introduced the three-red-lines rules limiting how much borrowing developers could do. Some companies with short-term obligations they couldn’t pay without new funding had to start discounting apartments to raise money.
Authorities have tried to curb demand in some places by slowing mortgage lending. They have put caps on existing-home prices in about a dozen cities to tame speculation, according to state media reports.
When old-fashioned funding sources like bank loans grew harder to access, developers became more reliant on presales of unfinished apartments. These made up 26% of the debt in Nomura’s tally.
Presales are often recorded as contract liabilities, an item that shows up on the balance sheets of sector heavyweights such as Evergrande, Country Garden, China Vanke, Sunac China Holdings Ltd. and China Resources Land Ltd. For these five combined, contract liabilities have jumped 42% in the past three years to the equivalent of $341 billion as of the end of June, FactSet data show.
Developers have also made more use of other liabilities that, like presales, don’t strictly count as debt, such as borrowing more from business partners by taking longer to pay contractors or suppliers.
Goldman Sachs Group Inc. analysts recently estimated Evergrande had the equivalent of $156 billion of off-balance-sheet debt and contingent liabilities, including mortgage guarantees to help home buyers get loans.
The other problem for developers, and for China’s property market overall, is the way some of the trends that fueled the boom are reversing.
China’s population is aging. Its workforce has been shrinking since 2012, and official forecasts last year predicted the total population would peak in 2027.
Homeownership is already over 90% for urban households in China, among the highest in the world, according to Mr. Rogoff and Ms. Yang. They cited earlier Chinese research saying that as of late 2018, 87% of home purchases were by buyers who already had at least one dwelling.
Julian Evans-Pritchard, an economist at Capital Economics, said his firm has looked at developers’ ability to meet their obligations from cash holdings and doesn’t think most are on the brink of default. But, citing changing demographics and reduced internal migration, he said “we’re now at a turning point where actually demand for new urban housing is going to decline over the coming decade. So they’re going to be fighting over a shrinking pie.”
Deng Lin, a 33-year-old lawyer in Shanghai, planned to sell two properties she owns to buy a bigger one after she gave birth to twins this summer. The government’s clampdown on debt risks derailing her plan of upgrading to a three-bedroom, which she estimates could cost up to $1.86 million.
Tightened mortgage rules means she would have to pay 80% upfront. Banks have been slow to approve her loan application.
“There’s simply too much uncertainty in the market,” she said.
—Anniek Bao contributed to this article.
...she was a rising Democrat star until she endorsed Bernie & opposed Clinton. Then she suddenly became a Russian asset, just like everyone else who opposed HRC became. Do we see a pattern here ?
love that spin...you could work for Fox with that gift