Evergrande about to go pop ?
Discussion
Stocks tumble as Wall Street's fears turn to China
https://www.cnn.com/2021/09/20/investing/dow-stock...
The Dow and the broader US stock market fell to close sharply lower Monday as Chinese real estate conglomerate Evergrande's debt crisis made American investors uneasy.
It was the worst performance since May for the S&P and the Nasdaq, while the Dow logged its worst day since July.
Stocks spent the whole day deep in the red and the Dow fell more than 970 points at its low point.
The market recovered slightly before the closing bell rang, but it was still an awful session: The Dow (INDU) finished down 1.8%, or 614 points. The S&P 500 (SPX), the broadest measure of Wall Street, closed down 1.7%, while the Nasdaq Composite (COMP) fell 2.2%.
Bank and energy stocks fared worst, with Goldman Sachs (GS) and JPMorgan (JPM) among the Dow's worst performers.
The White House said it is monitoring the markets, but stressed that Evergrande's business was "overwhelmingly centered in China."
Evergrande, which is struggling to manage its $300 billion mountain of debt, was supposed to pay the interest on some of its bank loans Monday, according to Bloomberg. The company will also have to pay interest on two of its bonds worth more than $100 million later this week, according to Refinitiv.
Why are global investors so worried about something that's happening in the Far East?
Everything is connected in the world of financial markets and the massive amount of money borrowed by Chinese companies has long been considered a looming threat to market stability.
Now investors fear the exposure that banks might have to Evergrande and companies like it.
Adding a dash of melancholy, this crisis comes on the thirteenth anniversary of the collapse of Lehman Brothers.
"We think the odds do favor the Chinese communist government will get involved should there be a default," Detrick said. "They are holding out as of now, but the fallout could be too great for them to avoid intervening."
Thoughts ?
https://www.cnn.com/2021/09/20/investing/dow-stock...
The Dow and the broader US stock market fell to close sharply lower Monday as Chinese real estate conglomerate Evergrande's debt crisis made American investors uneasy.
It was the worst performance since May for the S&P and the Nasdaq, while the Dow logged its worst day since July.
Stocks spent the whole day deep in the red and the Dow fell more than 970 points at its low point.
The market recovered slightly before the closing bell rang, but it was still an awful session: The Dow (INDU) finished down 1.8%, or 614 points. The S&P 500 (SPX), the broadest measure of Wall Street, closed down 1.7%, while the Nasdaq Composite (COMP) fell 2.2%.
Bank and energy stocks fared worst, with Goldman Sachs (GS) and JPMorgan (JPM) among the Dow's worst performers.
The White House said it is monitoring the markets, but stressed that Evergrande's business was "overwhelmingly centered in China."
Evergrande, which is struggling to manage its $300 billion mountain of debt, was supposed to pay the interest on some of its bank loans Monday, according to Bloomberg. The company will also have to pay interest on two of its bonds worth more than $100 million later this week, according to Refinitiv.
Why are global investors so worried about something that's happening in the Far East?
Everything is connected in the world of financial markets and the massive amount of money borrowed by Chinese companies has long been considered a looming threat to market stability.
Now investors fear the exposure that banks might have to Evergrande and companies like it.
Adding a dash of melancholy, this crisis comes on the thirteenth anniversary of the collapse of Lehman Brothers.
"We think the odds do favor the Chinese communist government will get involved should there be a default," Detrick said. "They are holding out as of now, but the fallout could be too great for them to avoid intervening."
Thoughts ?
The CCP will do whatever works best for it. If it means telling investors to suck it up for a few months or years, so be it. If it creates a worldwide financial markets meltdown and it can get advantage out of that, it will do that. If Western governments can do what they did about the 2008 crash and they're supposedly answerable to the public, imagine what a government that ain't answerable to the public could do!
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