China Property (thread #3)
Game-changer here?
Liquidity of USD20bn coming vs Mar/Apr maturity wall of USD12bn.
Likely for asset acquisitions, not debt bailout.
Implications for equities/bonds?
1/
#China #property prev threads:
Game-changer here?
Liquidity of USD20bn coming vs Mar/Apr maturity wall of USD12bn.
Likely for asset acquisitions, not debt bailout.
Implications for equities/bonds?
1/
#China #property prev threads:
https://twitter.com/ssinvestments8/status/1484059606355570689?t=UP07u1blJEnDuabzLT4w-w&s=19
https://twitter.com/ssinvestments8/status/1499659446192336896?t=UP07u1blJEnDuabzLT4w-w&s=19
China property HY fell -54% and equities -33% since mid-2021.
Bigger dip may not imply bigger rebound.
Equities can be diluted as bonds can be written down. But after that's done, equity returns are symmetric vs asymmetric for bonds, i.e. better risk compensation. $CHIR
2/
Bigger dip may not imply bigger rebound.
Equities can be diluted as bonds can be written down. But after that's done, equity returns are symmetric vs asymmetric for bonds, i.e. better risk compensation. $CHIR
2/
China property equities performance out of the trough coincided w sales volume trend.
Sales volume picked up 6 mths after home prices bottomed, which had happened 6 mths after easing.
Past few weeks, easing stance is finally aligned across policymakers.
h/t @jpmorgan $CHIR
3/
Sales volume picked up 6 mths after home prices bottomed, which had happened 6 mths after easing.
Past few weeks, easing stance is finally aligned across policymakers.
h/t @jpmorgan $CHIR
3/
After all, #China #property's strategic importance is beyond ~25% GDP contribution.
40% of local govt revenue from land sales. There is a budget spending increase ahead.
60% of household assets in property. Wealth effect can't be absent in reaching Common Prosperity goal.
4/
40% of local govt revenue from land sales. There is a budget spending increase ahead.
60% of household assets in property. Wealth effect can't be absent in reaching Common Prosperity goal.
4/
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