Dec 7, 2021 video says or implies: Insane property bubble bursts. Many halt new investments. Major U.S. investment firms are holding the bag, and won't be able to divest fast enough, before they lose your shirt. U.S. big biz China money grubbers are going down the tubes, right now. Their influence in Washington is OVER! The CIA scrambles to stay afloat as anti-communist backlash hits.
A Jan. 13 Bloomberg report notes:
The severity of the Evergrande disaster was seen Dec. 31, when China's central bank leapt into action to try to stem the hemmorhage. Its stock went up briefly a few days later, but despite heroic efforts by the communist government, Evergrande is headed for bankruptcy, kindly characterized as downsizing and restructuring. But clearly the continuing hits taken by investors in China's largest real estate company is not the end of the story. The entire civil economy is linked to the preposterous system caused by bizarre communist regulations.
According to the Securities and Exchange Commission, "A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investors. Ponzi scheme organizers often promise to invest your money and generate high returns with little or no risk."
This is an organized investment bubble that must someday collapse, either because of market saturation or by red flags setting off distrust.
Another sort of investment bubble follows a similar pattern. Investopedia relates, "Because speculative demand, rather than intrinsic worth, fuels the inflated prices, the bubble eventually but inevitably pops, and massive sell-offs cause prices to decline, often quite dramatically. In most cases, in fact, a speculative bubble is followed by a spectacular crash in the securities in question."
An investment bubble can be driven by an excess of exuberance, in which current investors spread the "good news," thus driving up desirability -- which carries a higher price sticker -- but not intrinsic value. That is, what would the value of the item be based on actual need rather than anticipated investment return?
Real estate bubbles turn out to be a recurring problem because of the ordinary person's belief that real property is "always" a safe investment. Thus demand for properties by investors begins to exceed demand by people who want to buy a house to live in or a building for their small business. (In the 2008 bubble, federal "red line" rules resulted in a market distortion that eventually went catastrophic.)
In China, the communists have made it almost impossible for the ordinary person to invest in anything but real estate. This has led to a supersaturation of the market with eager money. The purported value of property has now shot up to 50 times that of its intrinsic value, say experts. Such overvaluation is unsustainable, which is why a huge, rolling domino effect is wiping out investments, savings and businesses in China. Foreigners with major holdings in China are pretty much out of luck, though there is bound to be an exception or two to that outcome that proves the rule.
How weird is the Chinese real estate market? Weird enough that developers, up until recently, were routinely building sham cities composed of shell buildings lacking electricity, plumbing, elevators or other modern essentials. These shams were thrown up so that sales people could say there was "something there" for a would-be investor. The investors were so confident the value would rise, they put their money down! Only now they aren't, because communism's Ponzi scheme has -- as any noncommunist economist could have forewarned the resolute Marxists running the country -- inevitably hit FAIL!
Wikipedia piece on Cathie Wood, a China disaster soothsayer:
https://en.wikipedia.org/wiki/Cathie_Wood
News of the World neither encourages nor discourages the Patreon offers found on the video above.
The image above may give you the sense that the video is put out by irresponsible hustlers; that image is not commensurate with the content of the video.
A Jan. 13 Bloomberg report notes:
“If we call the past decade a golden age for the real estate industry, it is now trapped in the age of rust,” said Li Kai, Beijing-based founding partner of bond fund Shengao Investment, which specializes in distressed debt.The claim that few analysts foresee an imminent crash should be taken with a grain of salt. The U.S. economy nosedived when the 2008 real estate bubble burst. And China's real estate bubble is far more overblown than the U.S. bubble of 2008. What we have here is a Wall Street attempt to wave off the full impact of the current tailspin because so much U.S. investment has been committed to Chinese endeavors.
That transition promises to be especially painful for privately owned developers like China Evergrande Group that have already saddled international stock and credit investors with billions of dollars in losses.
While few analysts are predicting an imminent financial meltdown, risks from the real estate market are growing. Weaker property companies are under immense stress, hit by a double whammy of punishingly high borrowing costs and slumping sales. Lower-rated developers including Evergrande are already defaulting on dollar debt at record rates and contagion is spreading to stronger companies. Shares and bonds of Country Garden Holdings Co., China’s largest developer by sales, sank Thursday following a report it struggled to find demand for a new convertible bond.
The severity of the Evergrande disaster was seen Dec. 31, when China's central bank leapt into action to try to stem the hemmorhage. Its stock went up briefly a few days later, but despite heroic efforts by the communist government, Evergrande is headed for bankruptcy, kindly characterized as downsizing and restructuring. But clearly the continuing hits taken by investors in China's largest real estate company is not the end of the story. The entire civil economy is linked to the preposterous system caused by bizarre communist regulations.
According to the Securities and Exchange Commission, "A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investors. Ponzi scheme organizers often promise to invest your money and generate high returns with little or no risk."
This is an organized investment bubble that must someday collapse, either because of market saturation or by red flags setting off distrust.
Another sort of investment bubble follows a similar pattern. Investopedia relates, "Because speculative demand, rather than intrinsic worth, fuels the inflated prices, the bubble eventually but inevitably pops, and massive sell-offs cause prices to decline, often quite dramatically. In most cases, in fact, a speculative bubble is followed by a spectacular crash in the securities in question."
An investment bubble can be driven by an excess of exuberance, in which current investors spread the "good news," thus driving up desirability -- which carries a higher price sticker -- but not intrinsic value. That is, what would the value of the item be based on actual need rather than anticipated investment return?
Real estate bubbles turn out to be a recurring problem because of the ordinary person's belief that real property is "always" a safe investment. Thus demand for properties by investors begins to exceed demand by people who want to buy a house to live in or a building for their small business. (In the 2008 bubble, federal "red line" rules resulted in a market distortion that eventually went catastrophic.)
In China, the communists have made it almost impossible for the ordinary person to invest in anything but real estate. This has led to a supersaturation of the market with eager money. The purported value of property has now shot up to 50 times that of its intrinsic value, say experts. Such overvaluation is unsustainable, which is why a huge, rolling domino effect is wiping out investments, savings and businesses in China. Foreigners with major holdings in China are pretty much out of luck, though there is bound to be an exception or two to that outcome that proves the rule.
How weird is the Chinese real estate market? Weird enough that developers, up until recently, were routinely building sham cities composed of shell buildings lacking electricity, plumbing, elevators or other modern essentials. These shams were thrown up so that sales people could say there was "something there" for a would-be investor. The investors were so confident the value would rise, they put their money down! Only now they aren't, because communism's Ponzi scheme has -- as any noncommunist economist could have forewarned the resolute Marxists running the country -- inevitably hit FAIL!
Wikipedia piece on Cathie Wood, a China disaster soothsayer:
https://en.wikipedia.org/wiki/Cathie_Wood
News of the World neither encourages nor discourages the Patreon offers found on the video above.
The image above may give you the sense that the video is put out by irresponsible hustlers; that image is not commensurate with the content of the video.
