Many moons ago a passenger plane crashed into the Everglades. Perhaps you were too young to read about it back then. The company that flew the plane was called ValuJet.
On May 11, 1996, ValuJet suffered its highest-profile accident when Flight 592, a DC-9 flying from Miami to Atlanta, crashed into the Florida Everglades, killing all 110 people on board.
On September 20th 2021 a company with a similar name, Evergrande, crashed into Wall Street; Though his time the high flying company, Evergrande is located in China; a Chinese corporation that leveraged the real estate market. Selling millions of apartments to the gullible Chinese whose deposits somehow evaporated in the behemoths accounting bowels.
China’s embattled developer Evergrande is on the brink of default. Here’s why it matters
Snowed under its crushing debt of $300 billion, Evergrande is so huge that the fallout from any failure could hurt not just China’s economy. Contagion could spread to markets beyond China.
Here’s how big Evergrande is, how bad its debt problems are, and what’s next
The world’s most indebted property developer has been scrambling to pay its suppliers, and warned investors twice in as many weeks that it could default on its debts.On Tuesday, Evergrande said its property sales will likely continue to drop significantly in September after declining for months, making its cash flow situation even more dire.The Chinese developer is so huge that the fallout from a potential failure could hurt not only the Chinese economy, but spread to markets beyond.
Homebuyers and investorsProtests by angry homebuyers and investors broke out in recent days in some cities, and social unrest is among the concerns.On Monday, around 100 investors turned up at Evergrande’s headquarters in Shenzhen, demanding repayment of loans on overdue financial products — forming chaotic scenes, according to Reuters.
In fact, sentiment is already spreading to Asia high yield bonds. Yields on Asian offshore bonds, dominated by property firms, have spiked to an average of 13%, according to TS Lombard.
Its property services management arm is involved in nearly 2,800 projects across more than 310 cities in China.
The company has seven units dabbling in a wide range of industries, including electric vehicles, health-care services, consumer products, video and television production units and even a theme park.
The firm says it has 200,000 employees, but indirectly creates more than 3.8 million jobs every year, according to its website.
Evergrande’s shares and bonds are included in indexes across Asia.
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