The situation in China continues to unfold whether we're discussing the debt problems inflation perhaps is the power crisis or Evergrande I will get into all of that let's begin
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The U.S. consumer is maxed out. They need more stimulus in order to continue this economy. And of course, stocks need their artificial boost as well. The U.S. consumer is maxed out. Consumer sentiment is down heavily. Real estate continues to increase in price right now as we see low interest rates keep this going. There is upward pressure on markets right now globally because of the inflation of the money supply. As a result, we are finding prices of just about everything being higher. Money, cash, debt is coming into the markets at this time finding its way into stocks, bonds, real estate. Social security is running out of money. Pension funds are not keeping up with inflation. Natural gas and crude oil prices are rising as well as all energy and food prices. Commodities are rising higher including oil, crude oil. Some believe there will be inflation while others suggest stagflation, and others suggest deflation. Inflation resulted in food prices rising, electricity, energy prices. China Evergrande real estate having issues with debt paying their bonds.
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The situation in China continues to unfold whether we're discussing the debt problems inflation perhaps is the power crisis or Evergrande I will get into all of that let's begin let's start with this article out of CNBC stagflation in China is a very real risk in the next couple of quarters this is not just China we are seeing this all over the world stagflation is the problem you got rising prices like energy which we'll talk about in a moment but at the same time you just do not have that growth the risk of stipulation is very real in China over the next couple of quarters a high producer price index and a power crunch have made it difficult for Beijing to stimulate the economy aggressively so you can't do what they did before different things have to happen we'll see what they can do the producer price index is really going high and if it looks anything like we have seen previous in history we could potentially see that have a direct impact on the cost of goods for people for the average person so it's not just those big companies those billion dollar companies that are going to be suffering it's the average individual too and that is so unfortunate the slowdown in the real estate sector has very severely hit China's economic growth but confidence in the primary property market is not yet collapsing you could see that growth had slowed down tremendously in terms of the building they're worried about Evergrande I'm looking at the charts for Evergrande and I could see that it's about 241 all right now this previously was much, much, higher I mean it was in the 20s not that long ago and now today it's been falling and falling and falling so there needs to be some confidence restored in this stock in order to get the entire property sector to come back up that might happen if they bail it out to some degree but as of now China's plans to cap the key coal price to ease in energy crisis so they're going to do this I don't know historically how this has worked out but when you try to control things you only make it worse if you push something down here over there it's going to pop up cap to be set at 440 yuan per ton with a 20 upside limit will likely apply to power plant terms supplies so they get into this if you want to check it out there's a chart right here just showing you China's benchmark coal futures plunged after the government intervention so right there but the fact is what will the producers do are they going to be forced to sell at a price that they can't afford you know trying to do these controls generally ends up creating a problem later but that remains to be seen okay I just want to bring you the data as it is China's trading apps tank after official calls them illegal cross-border brokers have no legitimate license according to the people's bank of China so they are cracking down in every sense of the word I mean so many different aspects here things I didn't cover some things that I did cover ultimately when you look at what they're doing it seems like it is very strategic and methodical that they are going into a different mode this is very different than what we saw from let's say the 2000s and on very different here in the 2020s and I don't know what's going on precisely I can speculate but I just wanted you to know exactly what's happening this is what they're doing bulls return to China's markets just as the risks start to multiply why they're buying the dip the markets are very different from what we see in the actual economy I know a lot of people get that confused they see economy they think it's the same thing they think economy means stock market but of course that is absolutely not true and you can see HSBC, Nomura, UBS have turned positive on the nation's stocks and they look at it compared to the rest of the world because they say look everything is up like crazy particularly the US where do I put my money so they say hey China's down by 20 or what have you let's put our money in those tech stocks and we will have to see how that all goes in terms of the restrictions there's one further China limits construction of super high-rise buildings essentially what they're saying is in the smaller cities there's absolutely no need to have these skyscrapers they're there just for vanity just to show that hey we can build lots of stuff they are restricting copycat type of buildings and they're doing a lot of different things you might agree with it or not but I'm just trying to show you that it seems like they are taking control in every single aspect of the country more than before it seems like there was a loosening perhaps it got too loose for those in control and now they seem to be tightening up again a third of Chinese developers could face debt problems as Evergrande contagion grows big issues going on with Evergreen yeah, yeah, yeah, it's going to be fixed don't worry they paid their offshore bonds that was a very small portion of what they oh very small even the embattled property giant manages even if the embattled property giant manages to avoid default again many other firms are heading the same way there are many examples of this I have shown you so many over the period but just understand that they cannot pay this back without some sort of extraordinary measure taking place the company doesn't have the money the company can't do anything else because they already stretched themselves to the maximum they were giving out luxury products to the customers like doing anything that they could they were selling if you watched my channel before they were selling products to people debt based products giving them these high returns and so what happens when you end up in a crunch you can't pay them back so what about these people what's going to happen to them the money is just not going to come from anywhere the money was coming from new investors in but suddenly all of that demand has plunged particularly with Evergrande nobody wants to touch it at this time okay there's a lot in here of course I won't be able to get to the links as always down in the description okay check this out Hong Kong's luxury villa linked to evergreens we pledged for a loan so I had talked about in the previous video they are being forced into saying look you run that company this is your responsibility so now there's going to be a lot of shared prosperity okay so this is an associate of him he's basically the chairman of the chairman of the troubled China Evergrande Corp. so an associate has recently put up a luxury house in Hong Kong for loan collateral as the billionaire and his property empire face an escalating debt crisis now this is important of course because of the crackdowns that's what that's the message for today okay they are going full force into this you know you can read the details if you want but I'm just trying to make that point you could see that he also amassed billions in dividends before the crisis seven billion dollars worth in payout since 2009 not bad Beijing has urged the tycoon to help pay ever grant's debt so he's going to be forced to do this obviously there's really no way around that many people have suggested that this is a good thing some people say that there's much more going on I don't know if he's going to be able to pay back all of the bad debt even if he's completely wiped out there's still so much bad debt so let me know what do you think should this individual be forced to deplete his entire net worth by the way what is his net worth in is it in cash or is it in stock because you wouldn't want him to sell that stock because of course that's going to put more deflationary pressure on everything as a whole so what do you think put it down in the comments below I'd like to know your thoughts on how they can handle this particular situation or should they let the failure happen I want to know what you think okay now of course as always to support the channel it's a simple matter of hitting that like button when you do that these videos are more likely to end up in your home feed so I do appreciate that support the channel hit the like button and I'll see you on the next one
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