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Wow. You've heard absolutely 100% wrong. This very likely might be our Lehman Brothers moment.No. They are small potatoes from everything I’ve read
That one company may be 3% of the Chinese market, but it's not just that one company. It's pretty much every major real-estate company in China. It's therefore also every business dependent on these businesses, like the companies supplying building materials, laborers, etc, etc. Again, it's only in retrospect that we realize what kind of impact mortgage backed securities going back ended up having, but prior to the GFC virtually no one would have predicted that MBS's going bad would end up having the catastrophic effect it did. Evergrand and the other real estate companies have, figuratively, a thousand times more impact thatn MBS's ever did and that's just to start with. What kind of contagion effects the real estate market in China going south will have are currently unknown, but if the relational size of Evergrand/etc vs MBS's produce a similar relational size in the amount of financial contagion then this would end up causing massive havoc in the global economy that would make the GFC look like a day in the park.But that company is like 3% of the Chinese market, which is clearly propped up by the communist government (like the ghost towns). When 2008 happened here we didn’t crash Japan’s market or many of those in Europe. Yeah it’s connected but I would bet you 50 yuan this doesn’t become a huge ripple. The Us markets know this was coming and already priced it in
I'll take your bet and raise you a Zimbabwe $50,000,000 billBut that company is like 3% of the Chinese market, which is clearly propped up by the communist government (like the ghost towns). When 2008 happened here we didn’t crash Japan’s market or many of those in Europe. Yeah it’s connected but I would bet you 50 yuan this doesn’t become a huge ripple. The Us markets know this was coming and already priced it in