For example, according to Bloomberg, China’s second largest contracting company, China Evergrende, recently raised $ 1.8 billion in dollar bonds and was forced to pay 13.75% interest on 5-year bonds. This is the highest return the company has ever paid.
The drop in prices also led to unexpected results. In October last year, purchasers attacked the sales offices of a construction company in the east of Jiangxi Province when they learned that the company had begun offering discounts of up to 30% on unsold inventory.
Similar plays took place in ten different places in the last quarter of last year. In the prestigious Paduaong district of Shanghai, dozens of apartment buyers gathered at the front of a local contractor’s office with placards stamped “refund our money,” after hearing that the contractor, Country Garden, lowered prices from 35,000 yuan (about 470 dollars per square meter) -26 thousand yuan. Thus, the credit bubble has trapped Chinese real estate developers and China’s capital market from every direction.
But the Chinese economy is suffering not only from a real estate credit boom, but in the next article we will look at what the credit to the Chinese manufacturing machinery, the bond market and the country’s balance of payments have done.
Wall Street trading closed slightly higher; Check Point lost 8%
ZOOM’s shares rose 75% on its first day on Wall Street • The Turkish lira falls amid reports that the central bank used short-term loans to increase foreign exchange reserves • Check Point beat forecasts, but revenues from products and licenses fell by 4.5% to $ 113 million • Tomorrow, Good Friday, most of the world’s stock exchanges will be closed, and Japan and China will trade as usual
Wall Street trading closed slightly higher. The Dow Jones rose 0.26%, the S & P 500 added 0.16% and the Nasdaq closed steady.