Reuters: SOE developers and local govts asked to step in to buy Evergrande assets.
This has been my central theorem for a "market-oriented approach" solution.
Avoid direct state intervention. Get state govts to supply slightly senior/pref equity.
reuters.com/world/china/ch…
This has been my central theorem for a "market-oriented approach" solution.
Avoid direct state intervention. Get state govts to supply slightly senior/pref equity.
reuters.com/world/china/ch…
Get quasi-private sector involved to manage project completion with effective credit enhancement to projects. Get some cash into projects to complete them, possibly to push some equity back to Hengda.
Allow Hengda to wind itself down slowly through debt repayment.
Allow Hengda to wind itself down slowly through debt repayment.
It may not happen quickly enough for everyone, but 'progress' which looks like the right people (those who got rich) are suffering pain and the right people(those who bought flats) are being prioritised would go some way to mollify the crowds.
And in the end, I expect China is not prepared to tear it all down. Unless you think China is willing to hit RE prices and GDP very hard, deliberately, one has to conclude there is a lesson being taught. The question is and has been... to whom? and how hard is it being taught?
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