China planning $12 Billion+ bail out for distressed real estate sector

[bbhaag]

China will launch a real estate fund to help property developers resolve a crippling debt crisis, aiming for a warchest of up to 300 billion yuan ($44 billion) in a bid to restore confidence in the industry, according to a state bank official with direct knowledge of the matter. Whispers of protests are starting to come to light as more and more Chinese citizens become disgruntled with the matter.

China plans real estate fund worth up to $44 billion for distressed sector, source says

China will launch a real estate fund to help property developers resolve a crippling debt crisis, aiming for a warchest of up to 300 billion yuan ($44 billion) in a bid to restore confidence in the industry, according to a state bank official with direct knowledge of the matter.

www.reuters.com

 

[thilanliyan]

Doesn't seem like a lot considering the bailouts that American/European companies have gotten, but I don't know that industry very well.

 

[Leeea]

The headlines are screaming far more then that is missing.

Like 7 trillion yuan. This is like trying to put out a forest fire with a squirt gun.

 

[cytg111]

Good. Alternative would have sent chock waves around the planet plus these things only ever hurt the working man and woman… At the end of the day we’ve got alot more in common with working class Chinese than we do with the local brand of super rich.

 

[sdifox]

LoL how much of the fund will be embezzled, like the original pile?

 

[Thump553]

I view that figure with great suspicion. The assets are grossly, grossly overstated and Chinese developers have been kiting funs for years. Apparently they don't hold funds in escrow there-the customer pays in full for condo/apartment to be built, gets a mortgage on the same fictitious collateral and the developer uses those funds to pay off the last project's bills. That bubble was driven the then universal belief that property values would go up forever. That delusion is now gone.

The linked article doesn't mention anything bailing out the banking crisis being cased by this flood of bad mortgages. This bailout sounds like an ineffective joke-probably designed to protect/payback a few connected insiders.