by Chris Black
– During the year 2022/2023, China will participate in 28.4% of global growth, compared to only 8.5% for the US. (France has 1.3%)
– What happens in China will have 3 times more impact in the world than what happens in the US.
-The Evergrande crisis is a debt crisis (as with subprime).
-The real estate sector represents 20% of Chinese GDP. By comparison, in 2006 (pre-crisis) real estate represented 7% of US GDP.
– China’s property market is clearly in a bubble, and it looks like it is bursting.
-Evergrande is said to be around 300 billion in debt and its stock has already lost over 80%.
– This debt involves over 128 banks, so defaults are a systemic risk.
– According to senior Chinese officials, this bubble could threaten Chinese finance and its economy as a whole.
China's central bank injects 120 billion yuan ($18.6 billion) into the banking system after concern over a debt crisis at Evergrande roiled global markets t.co/U75QYOkie6
— Bloomberg Economics (@economics) September 22, 2021