I struggle to get my head around the size of the Chinese property collapse & it's global consequences.

[StrawberryMarble]

Is anyone else following this? Because it will affect us for sure down the line. 65 MILLION properties in China are in a limbo of being half built & the developers have run out of funds. This is way way bigger than the sub-prime crisis in the US. Blocks of flats are being demolished in their thousands. The Chinese government is pumping trillions in to keep the economy afloat. I think we're in for an unprecidented global recession that will bite longer & harder than ever before when you add in the cost of covid and the energy crisis.

I agree with you. And yet people are acting as if it isnt.

I thought China had the best and most stable economy? Partly due to the government being so controlling?

If not...then dear God...we are in for one hell of a bumpy ride 😯

Yikes

is there a link or something I can read more about this

I had no idea

I have only just heard of this... some reading to do. Bloody scary though!

Thanks for this post.

My main concerns are Russia and China and that Ukraine is the tip
of the iceberg. There is a lot more going on that is hidden.

It may be a problem but I cant do anything about it so I do not waste time worrying

There is a lot more going on that is hidden.

What does this even mean? If things are "hidden", how would you know about it? And if you do know about it, please share. Otherwise you're merely a scare mongerer and don't we have enough to be worrying about at the moment?

As for links, there's loads if you just google China housing crisis. There's also lots of economics videos on Youtube that are easy to follow. I suspect that somewhere around the world, maybe the UK too, that pension funds will have some holding in the Chinese housing market because up until recently, the returns were exponential.

Only the veneer of stability @Pixiedust1234 Due to the one-child policy & more recently a marked reluctance for young women to marry & have children, they're beginning to experience a collosal shrinkage of population. Like us, when the much smaller younger demographic has to support the giant mushroom of elders, that too will have an impact.

I watched a video where Elon Musk was talking about population shrinkage. I’m not clear of the consequences of that - can anybody explain?

When you have a low birth rate, like China, you end up with an ever decreasing working age population to support all those who are retired. This is an issue faced to some extent by most affluent countries, Israel being the exception for specific cultural and historical reasons, but it's particularly stark for China for two reasons. One is that they've never been that affluent. This is happening to them while average income is still pretty low, so they don't have the cushion of being a rich society. And two, because of the effects of the one child policy it's all been sped up. Usually it takes a lot longer to happen.

In regards to the population, the number of inhabitants of China is expected to halve by 2050. There are no soft landings for an economy suffering that kind of decline.

Why don’t I read this stuff in mainstream news?

There are also lots of videos on TikTok, I just pulled the first 2:

vm.tiktok.com/ZMNWFTkrg/

vm.tiktok.com/ZMNWYYdTb/

I am surprised China is allowing this type of news about their Country ?

Evergrande is a good example of this mess. 300 billion dollars in liabilities, thats extraordinary to me.

There's a limit to what can be prevented these days, unless you're going to go full on hermit kingdom like North Korea, which China clearly couldn't and don't want to. The regime weren't even able to stop the world from finding out about the gulags in the Uighur homeland, so it was never going to happen with something as significant to the global economy as Evergrande.

I have heard about it via Evergrande, and also the population collapse. I didn't think it'll affect us here though!

But I could be naive about the forces of macroeconomics.

Evergrande is one, Shimao is another. If you have a pension, it’s likely that a small portion of it will be invested in these companies so your fund will have lost money. However, pensions are diversified which means you will have exposure to all areas of the market to limit losses.

The Chinese prefer to buy brand new properties rather than old. The scale of this is huge. These companies were generally invest friendly and seen as a safe bet due to high demand for new properties, so money was ploughed in and now they have had they investment rating downgraded making the investments worthless.

Bloody hell that’s an enormous decline
whst did they think would alleviate that drop off?

www.bbc.co.uk/news/business-62629144.amp

could I also add that most chinese are unvaccinated and the government are still chasing zero covid, so they lock whole blocks of people up because 1 person has tested positive.

shanghai has only recently come out of a 2 month lock down and individual blocks are still been thrown into lock down.

how can this be any good at all fir the Chinese economy?

www.bbc.co.uk/news/av/world-asia-62224790

and this happened last week

www.telegraph.co.uk/world-news/2022/08/15/watch-ikea-shoppers-scramble-escape-shanghai-store-placed-flash/

by the looks of it you can get locked into any building 😱

Hong Kong had been taking China’s lead in the quest for zero Covid too. Visitors to the country had to quarantine for 21 days in a hotel. This has been terrible for the economy there too, expats and big business have left. People had their children in British boarding schools and couldn’t see them due to quarantine requirements. Thankfully this has been reduced.

I agree with you. And yet people are acting as if it isnt.

But... what is it exactly that you'd like people to do?
Spend their days huddled in a corner crying?
Run around screaming?
Start panicking buying and stockpiling?
Or start more threads to make people feel anxious and scared?

On a personal level (and I assume many people are similar) I know that things are bad right now and many of them are outside our control. Even if we had a decent govt or were able to apply enough pressure via protests etc. There's very little we can actually do just now.
So, I'm choosing to enjoy the life I have right now and to be as happy as I can be. Because starting endless scaremongering threads and trying to bring other people down isn't achieving anything either.