Missed Interest Payment Upped, Evergrande Bankrupt, Western Media Corrupt, Financial Disrupt, China Hiccuped, HSBC Next Up And If The Poop Hits The Fan The Public Might Just Erupt
/By Stan Szymanski
Before we get to the -real news- let’s first examine today’s ‘stories’, shall we?
Evergrande has reportedly made good on another payment, averting default once again-CNN Business-By Laura He, CNN Business - updated 3:33AM Fri. October 29, 2021
Evergrande Pays Overdue Interest and Again Dodges Default-Eliza Ronalds-Hannon Thu, October 28, 2021, 8:00 PM (Bloomberg via Yahoo)
Evergrande averts default with interest payment – reports - Guardian Staff and Agencies-Fri 29 Oct 2021 00.11 EDT
Evergrande Averts Default Again But More Coupon Payment Deadlines Are On The Horizon-Forbes-Yue Wang, contributor Oct 29, 2021, 05:35am EDT
Evergrande Averts Default Again by Making Second Late Payment-Wall Street Journal-By Elaine Yu and Frances Yoon-Updated Oct. 29, 2021 5:14 am ET
Evergrande paid another bond interest just in time again, averting a default after Chinese authorities pile on pressure - Huileng Tan -Oct. 28, 2021, 10:39 PM
This past Tuesday I reported that Dr. Marco Metzler, former Fitch analyst and now of DMSA (Deutche Mrkt Screening Agentur GmbH) has announced that the past due interest payment on China Evergrande Group’s offshore international bonds that all of the western media reported as supposedly paid by Evergrande could not be confirmed. Today, he is saying that the interest payment ($47.5 Million) allegedly made by Evergrande according to the western media last night (see ‘stories’ listed above), has not been paid either.
According the the GMBH News Release dated today (10/29/21)…’For the second time in a week, China Evergrande Group has apparently technically defaulted on interest payments to international investors.’… and in the opening paragraph goes on to say…’Should the Evergrande insolvency not only drag down China's real estate sector, but the entire economy of the country, we will see even bankruptcies of major international banks - such as HSBC, fears DMSA senior analyst Dr. Marco Metzler.’…
…’ But there has been no official confirmation of any payment of that interest by the close of business at Hong Kong banks’…continued Metzler. Besides Encouraging Angels, the only other known doubts that concur with Metzler appear in a recent report in the Financial Times today. Dr. Metzler goes on to state that no one replied to their inquiries as to an actual confirmation of the payments to creditors by Evergrande.
"Thus, the bankruptcy has apparently already technically occurred," analyzes Metzler. What if Evergrande could sell assets to raise funds to avoid bankruptcy? The company’s ability to raise funds through asset sales has failed in this environment as a deal to sell some of its assets to Hopson Development Holdings fell through. According to reports, the deal would have been worth 20.04 billion Hong Kong dollars ($2.58 billion), according to filings.
This is, of course horrible news for a company who has over $300 billion of debt. How much good would $2.6 billion from the failed Hopson deal done for Evergrande anyway? $2.6 Billion is less than 1% of Evergrande’s indebtedness. A drop in the bucket. Evergrande is indeed, bankrupt no matter what the mainstream brokers of financial information (again, see stories listed above) try to sell you. Just as a casual observance, it is interesting to note that 5 of the 6 stories from the ‘western’ journalistic sources above have writers who have apparently Chinese names (and a sixth, The Guardian, doesn’t tell you -who- exactly is responsible for penning the story). I have no ax to grind with the Chinese people; but if I was writing a story about the placement of nukes in Poland and gave you 6 news sources and at least 5 of them were Polish -and- all on the same side of the argument that benefitted Poland wouldn’t you question the media’s sources all leaning one way?
I do have a problem with the communist party and any other totalitarians. Who is hurt by China Evergrande Group’s non-payment of interest when due and how are they going to pay their principle on its US$2.03 billion bond maturing in March 2022? How about Hong Kong being hurt and their banks who did not receive this most recent payment according to Metzler. How about The United States of America and its banks and corporations that are bondholders. Who said that they will recapture Taiwan? Who has said that they want to take over and invade America and -not- cohabitate with Americans when they (supposedly, but not on my watch) do (thank you Dave Hodges for all of your work on this subject)? It is, of course, the CCP.
The Communist Party in China has a seat at the table in every corporation in that country. Here is what The Guardian had to say about the process in 2019:
…’The relationship between the party and private sector companies is, up to a point, flexible – certainly more so than with state companies. The party doesn’t habitually micromanage their day-to-day operations. The firms are largely still in charge of their basic business decisions. But pressure from party committees to have a seat at the table when executives are making big calls on investment and the like means the “lines have been dangerously blurred”, in the words of one analyst. “Chinese domestic laws and administrative guidelines, as well as unspoken regulations and internal party committees, make it quite difficult to distinguish between what is private and what is state-owned.”
So who runs Evergrande? Is it an autonomous market driven entity or is the ‘party’ involved in how the company is run? Is it possible that ‘the party’ would pick a company or an industry to use to attack its enemy (like the US or Taiwan/Hong Kong-take away its resources)? Would it be beyond the consideration of possibility that the party has people in the financial media who provide cover for party operations? It simply could be that the party has all the power but has now fulfilled The Peter Principle and become utterly incompetent in the face of running things at this advanced stage of their evil development. Why does any of this matter?
Because whether it is Dr. Metzler (THE GREAT RESET-Evergrande and the Final Meltdown of the Global Financial System) or Klaus Schwab telling you, there is going to be a ‘Great Reset’. When it comes to the financial system there will be new countries/entities/corporations that will lead the pecking order. The United States can only hope to be one of the players at the top. It will no longer hold the sole position of the world’s only reserve currency.
Of course, the CCP is not the only body who is looking to dethrone the US and take reserve currency status from it. Globalists, of many countries, even from within the US seek to break America and turn it into a vassal state of the power elite and use the resources of America for their purposes. How could this breakdown come about?
From today’s press release from GmbH: …’Metzler considers it quite possible that Evergrande could drag China's entire real estate sector down with it. This could have serious implications for major international banks such as HSBC. According to their figures for the third quarter of 2021, Hong Kong's largest bank alone has extended loans totaling 19.6 billion U.S. dollars to Chinese real estate groups. Assuming a recovery rate of five percent in the event of an industry-wide wave of bankruptcies triggered by Evergrande, HSBC alone would have to write off around USD 18 billion.
If one also considers the limited possibilities of international banks to access assets in China (see above), there is much more at stake for HSBC: the default of the entire portfolio of Chinese corporate loans. And that, after all, is worth around $196 billion. "Such immense lending to Chinese companies, without a guaranteed possibility of accessing collateral in China itself in the event of bankruptcy, is irresponsible in my view," says financial expert Metzler. With a return of five percent, HSBC would have to write off around 186 billion dollars in this case. That would correspond to almost the entire equity capital of the bank. And would probably lead immediately to its bankruptcy. This would make HSBC a victim of the Chinese financial virus, which would then spread rapidly throughout the international financial markets. "The Great Reset - the final meltdown of the current global financial system - has long since ceased to be a purely intellectual thought experiment," concludes Dr. Metzler.
So we see the corporate media carrying the water and spinning yarns for those who benefit from what is perceived as reality to keep the myth going that Evergrande is solvent, or at least, not collapsed yet. If you click on the links to those articles at the beginning of this writing you will quickly see each writer defer to ‘sources’ or ‘according to the New York Times and Bloomberg. Each publication cited unnamed sources.’ or ‘according to people with knowledge of the situation, who asked not to be identified discussing private payments’. Why did none of the financial reporters contact a ratings agency (like Fitch, Standard and Poor’s or Moody’s) or the custodian bank for the bond issue? My guess is that this way they can still have plausible deniability about the certainty of the matter while still peddling the globalist narrative.
The corporate financial media is keeping you coddled and anesthetized as to what is actually going on. Why does all this matter to you? It matters because, silly, your money is IN this financial system. Because you, who are not paying attention and think that the Federal Reserve is doing good by printing all that money…because a friend shows you research from Janney (yes, this did just happen to me) that goes through why there is a problem with Evergrande, and says that it will not interrupt the bull market-stock brokers -always- have to be positive in order to be able to sell stocks… because you, who thinks that the stock market only goes up and it just can’t stay down if it does go down…because the truth is that this market is most likely heading for what Ludwig Von Mises referred to as the ‘crack up boom’ where ‘Borrowers cannot repay their obligations when payment is due, and neither can they afford paying higher borrowing costs. Investors start fleeing out of bonds, making interest rates increase sharply and thereby covering up unprofitable investment. More borrowers, including banks, fail to meet their obligations, and bankruptcies spread. Ensuing recession and rising unemployment aggravate the collapse of the credit structure’…
So that spells the end of the existing system, which could happen. What if there isn’t a complete end of the financial system? What if it turns into a situation like we saw in Greece and Cypress? When the banks have shut their doors and you can only get $300 out per week-how will you pay your bills and avoid your own bankruptcy?
You could consider getting out of debt now. You could consider having an appropriate amount of another form of money outside of the current system like gold or silver or a ‘Trillion Dollar Coin’ (the last one is a joke, I think). You might want to have food, water, energy, shelter and security taken care of. None of this is financial advice. Consult your financial advisor.
This situation is certainly becoming big enough for you to consult The Bible on how you should consider your actions and the eternal consequences now, during the last days of many things.
If you appreciate this article perhaps you might consider a gift to Encouraging Angels for the intelligence we provided today.
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Stan Szymanski (or Encouraging Angels) is not a medical doctor. This is not medical advice. In all matters pertaining to the health and care of a human being consult a medical doctor. This is not legal, financial or personal advice. Consult appropriate professionals in those fields for that type of advice.
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