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China’s property crisis deepens as another huge developer risks default

China's property crisis deepens as another huge developer risks default | CNN Business

https://www.cnn.com/2023/08/09/economy/country-garden-china-property-default-intl-hnk/index.html

Investor confidence in China’s troubled property sector has been rocked again this week by reports that one of the country’s largest private building conglomerates missed interest payments on two bonds.

China's property crisis deepens as another huge developer risks default | CNN Business

35 comments

Jackolantern

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Damn so many tankies on this thread

tal

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I have to say that of all things in China for Marxist-Lenninists to be defending, the Chinese urban real estate sector of 2023 seems like a pretty odd choice.

teft

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Read up on the concept of "face" in asian cultures. China doesn't like it when they appear weak or stupid. In any arena.

renownedballoonthief

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Who here is defending the actions of Country Garden?

teft

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Happens anytime you mention anything bad and china. The apologists and downvoters come out and play. Same thing used to happen on reddit.

greyfrog

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That's pretty rude. I'm all for critism where it is due but seems like in any article about China rather than discussing the article we use the article to prove our preconceived notion is truth.

Same as I don't automatically believe any article I read about UK/US/Europe.

teft

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Building ghosts cities to hold 30 million people and then not filling them. Who would have thought that’s not a valid strategy for property management?

TenderfootGungi

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They are now filled.

just_browsing

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Some are, but not all. The point here is building entire towns or entire new city sectors in one fell swoop instead of planning them out and building them in stages so plans can be adjusted as needs inevitably change is a bad idea. It's things like this that have directly led to the current property market crisis.

Of course if buildings are already there it makes sense to use them, but they might have been able to put something better suited or more economically viable there if they had staggered the construction.

renownedballoonthief

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Your propaganda is a decade out of date. If you actually read the article, the current issue is that a lot of people aren't receiving the housing they prepaid for.

Aside from that, I'll take "too much housing" over the hell world of trying to find a place to live in the US any day of the week. The ghost cities complaint always seemed like coping to me.

tron

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Tankies are really one to talk about Propaganda. Go away!

renownedballoonthief

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How childish.

thebestaquaman

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a lot of people aren’t receiving the housing they prepaid for.

the hell world of trying to find a place to live in the US.

Your propaganda

I'll just leave this here for you to think about.

VolatileExhaustPipe

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You are correct, the "ghost city" claim is about a decade old and in the time since then good functioning cities developed incorporating those infrastructure and urban resources built previously.

Zhujiang New Town for example can house up to two million people (often moving out from the 7-10 million living in the old areas) and while I dislike the urban planing of it, it was once among the foremost called "ghost city" in propaganda, yet it is larger than most cities in most states of the US as example.

I also agree that having too many flats seems to not be that bad a problem to have. Especially when 2‰ of the US are unhoused - even though there are millions of empty flats.

jumperalex

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Right up until the demand for housing turns flat and then negative due to unquestionable demographic realities facing China. When such a huge percentage of the populations net worth is tied to real estate, the impact of a housing crash can't be ignored. And there is a storm coming, the numbers don't lie. In the next 20 years China's population WILL shrink

https://www.salon.com/2023/07/30/chinas-great-leap-backward-so-much-for-the-next-dominant-superpower/

https://www.huffpost.com/entry/china-population-drop_n_63c69f7be4b0cbfd55f616e2

https://www.economist.com/graphic-detail/2023/08/03/china-will-become-less-populous-more-productive-and-more-pricey

VolatileExhaustPipe

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The numbers will sink in the next 20 years for pretty much all "developed" OECD countries. Including the US, UK, France, Germany... yet how often do you personally write about that problem? When even people like professor Reich of Berkeley mention the 40(?) trillion $ wealth transfer due to shrinking population and that mostly to a small group of population with reduced demand for housing you seem to focus a lot on a country you are not living in.

Do I think China faces challenges? Surely. Do I think the capitalist market oriented parts of it will lead to problems that are integral to capitalist market systems? Sure. The CPC has much more power to act on it though. China is currently able to house its population much better than 30 years ago after the crisis of the fall of the Soviet Union. Germany's capital is missing 600k affordable flats at the same time.

Lets see how things will play out, but similar articles were published every couple of months for the last 20 something years. That generates sentiment.

jumperalex

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The difference between those OECD countries is that they allow migration. Nationalistic and racist temper tantrums notwithstanding, those countries are bolstering their working age ranks with migrants. China is distinctly anti-migration. So they've been digging a giant hole that's going to take a LOT to fill. And they haven't even stopped digging yet (first rule of getting out of a hole!)

So, could China change that stance as a way to mitigate the issue? Sure. But they better up their human rights record or they are only going to attract the most desperate of migrant with no other options. That doesn't bode well for a strong economic engine. Though cheap exploitable labor does help [shrug]

Astroturfed

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Their housing market is still unaffordable for Chinese citizens. Rather be in an unaffordable housing market where I get what I pay for. Like the house, that I'm typing this in. Which I paid for, and then got the keys to.

TenderfootGungi

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They have a tightly controlled economy. The government will do whatever it takes to keep a default from spinning out of control.

jumperalex

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yeah there are certain things they can't do, like magically create population they don't have. even the BEST predictions, based on China's own reporting (which is suspected to be very inflated) say they are in for a very harsh reality demographically speaking.

https://www.salon.com/2023/07/30/chinas-great-leap-backward-so-much-for-the-next-dominant-superpower/

https://www.huffpost.com/entry/china-population-drop_n_63c69f7be4b0cbfd55f616e2

https://www.economist.com/graphic-detail/2023/08/03/china-will-become-less-populous-more-productive-and-more-pricey

So yes they might be able to handle this current situation, maybe, but they are in for a very rough time of it and they have very few options.

Astroturfed

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Shrinking population +people buying as many apartments as they could as it was viewed as the only "good" investment (their stock market is a complete joke, filled with scam companies with fake numbers run like ponzi scheme). The real estate market there is due for a wild correction. The housing market in America has been manipulated by greed but at least there arent as many empty apartment buildings. Here people are least rent out their real estate and become slumlords.....

Jaysyn

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"Oh no, it's the consequences of my misgovernment."

jumperalex

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They are right on the cusp of the 2nd step of fucking around ...

renownedballoonthief

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Which government actions led this private corporation to fail?

VolatileExhaustPipe

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https://trends.google.com/trends/explore?date=all&q=china%20crisis

Seems China is always in Crisis according to Western news. The consequences seem to not be there though.

Instead wages increased threefold within ten years. It is funny that the Isle of Man got the most searches for "china crisis", I would guess cause it is a tax haven and therefore sensitive to such "news"?

Without joking, China did manage to succeed through ten crisis and you can read Wen Tiejun's book about it

Prandom_returns

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Today: a weatern basement-dweller furiously defends a murderous authoritarian regime, while eating a burger and shit-posting on the world-wide(almost)-web.

In other news, there's water in the ocean.

MicroWave

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They’re posting from lemmygrad.ml, so that should give you an idea.

The article literally quotes Chinese state media’s report on the matter.

VolatileExhaustPipe

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Touch grass, you project stronger than the Leica Cine 1. If the admins would do your job your comment would be deleted already. Click my link, does that look like there are often news about crisis that don't come to fruition? Sure does. Do you disagree with the book you can receive from Springer Link?

While property dealings can have effects (look at my link at see at 2008/9 how impactful the financial crisis from the US was even for China), the article doesn't manage to break beyond the general sentiment. Articles like that are often followed by high noise low signal comments which mirror sentiment of the user base, in this case mostly US dwellers that are underemployed. So a bit Sinophobia is expected, likely with topics related to property, so "Ghost cities", "expropriations", "shady construction" while using standards the people don't actually hold up in regards to their own countries.

Prandom_returns

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I'm not clicking any link that comes from a lemmygrad.ml user, lol. It's like licking a handrail in a metro station.
This is not hexbear, nor lemmygrad, people are alowed to laugh at tankies.
Become a journalist and write an article in CNN, maybe I'll read it then. Until then, I'm not interested in lemmygrad blabberings.

renownedballoonthief

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Your attempt at bullying is just sad. Go touch some wildflowers.

Prandom_returns

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What is it with lemmygrad weirdos and telling people to go touch stuff? Lemmy isn't the authoritarian, murderous regime of china, I'm free to do as I please.

HellAwaits

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Need some tissues? How about a blankie?

awwwyissss

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Go away lemmygrad.

jumperalex

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Their population demographics are a problem that is going to be much harder to manage. If they succeed, good on them for figuring it out. But they've managed because they've had fresh population to feed into their economy. That is NOT going to happen going forward. So they better change their strategy.

Honestly, I hope they do for the sake of the human beings living on that piece of earth currently ruled by the CCP. I actually wish them no ill will and the rest of the world is likely to suffer if china has a full on collapse.

And yet still, fuck the CCP.

JustAManOnAToilet

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To be fair I mean it's called the Isle of Man, of course people are going to Google it.