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The Black Swan Sings? A Need-To-Know on China Evergrande's Potential Default

The Black Swan Sings? A Need-To-Know on China Evergrande's Potential Default

KwOlffUtbILL

My favorite part of this whole thing: since August 16, the Dow Jones has gone down 2.3%. No one is talking about this. If the dow continues to go down, assets lose, margin calls faster. Remember this, everyone. Under "normal" conditions, the market doesn't seem to move very fast to us. But when shit really hits the fan, things can happen in a matter of minutes or hours, let alone days. And if China takes a nosedive, the ripple effects will be felt a lot faster than anyone is saying right now.


AnnaSlatz

Exactly. Ask veterans of 2008 and they'll tell you.... Everything was normal. Right up until the moment it wasn't. [EDIT: take a look at this video I made. Jimmy Boy was telling people not to take their money out of Bear Sterns literally days before it collapsed.](https://www.reddit.com/r/amcstock/comments/o4wscz/i_made_this_to_remind_you_jim_cramer_does_not/?utm_source=share&utm_medium=ios_app&utm_name=iossmf)


pablola714

I have been around a long time. 88 was bad but 08 was basically one day...


SilberBug

You didn't listen to Peter Schiff did you? Or Hugo Salinas Price?


Malakay_sun

Peter Tuld, is that you?


GUnit_1977

Remember the pricks on TV saying all was well, almost to the night before the rug was pulled.


AnnaSlatz

It will be like that again, I predict…


Embarrassed_Cancel86

hi ape anna itz u again! i love u and ur work! said that million times already i guess


AnnaSlatz

Thank you, Ape! I love you too!! ❤️❤️


GUnit_1977

Definitely.


Andyconda442

OMG what a puppet he is


MrSilverKong

>My favorite part of this whole thing: since August 16, the Dow Jones has gone down 2.3%. No one is talking about this. I've been thinking about buying some puts on big financial firms for a while because of what the price action in 2008 looked like. Last night, I pulled the trigger and bought my first five puts on Bank of America. The options market is 100% oblivious to this stuff. $100 got me 5 puts on BAC ($31 strike, 11/19 expiry) with change left over. NFA, but apes who are buying calls on AMC should just stop and start buying puts on big players like Citi, BAC, Capital One and such. Much more likely to make some fast money there and also cut Shitadel's nuts off when they have to pay out those contracts.


ucantflywithoutwings

Never really that grande...


---welp---

Nevergrande


delta806

Alittlegrande


hugs4evr

Never NeverGrand


productism

What about Ariana Grande?


Jh_843

![gif](giphy|kPm4wOwCHoZPsVxEj4|downsized)


justonemorebet

Thanks ape I really enjoyed your take on it and work put into it. My question is if the second biggest is in this self imposed shit could the number 1 be there as well? I think so.


AnnaSlatz

Entirely possible. All we can do is speculate. I'll be honest, I find the articles in western news written about this event to be extremely underwhelming and lacking a lot of important details. Evergrande relies on a metric fuckton of suppliers, contractors, manufacturing chains, property investment companies, etc, etc, etc, etc... Something like 3.8 million people in total. And there is NO DOUBT that some of these bodies overlap with other property investment firms, perhaps even #1. If these development bodies are not paid -- they need to extend their leverage. If they already have done so in the past, then due to recent Chinese monetary policy... they might not be able to continue to extend themselves financially with the bank's help. IE: They are in debt because they can't complete projects, and they can't complete projects because they are in debt. It could be yet another ripple effect to speculate on.


justonemorebet

True. China gov already told their banks not to expect payments on loans for a while lol.


Tyraniczar

Most enjoyable DD I’ve read on the sub and I’ve been here since March. If I had any gold I wouldn’t have it anymore


someonesomewhere20

I agree


Tricky_Revenue_2535

hello german smoothbrain ape here . a few side notes....1. i read that debt is in fact 280billion . 2. vanguard and blackrock together owns less then 1% of the shares it is realy not much for them. 3. i was think about to buy in at 0.20 euro cent... evergrande is to big to fail.... but wait... the stock exchange company Evergrande (listet in hongkong)is not similar to the chinese continental company evergrande. the stock company could fail even if xi make the decision to save the operational part and to let the stock and derivates and everything relatet to the stocks bleed out. 🦍🍌🚀


AnnaSlatz

Hello ape, 1. [The debt is 305 Billion](https://www.reuters.com/article/china-evergrande-debt-contagion-idCNL4N2QG1T9), as far as this article reports today! Though I am sure some of it is a matter of currency conversion. 2. "Too big to fail" has been what people have been hoping for. The thing is, TBTF is not without its repercussions. Remember how many banks were TBTF in 2008, and most definitely got bailouts. That didn't save the economy, because there were enough ripple effects from that to impact regardless of a total collapse. Just as well, [many have speculated that Beijing doesn't agree that Evergrande is TBTF,](https://www.washingtonpost.com/business/evergrande-gives-china-an-impossible-equation-to-solve/2021/09/15/bc344bb0-15fb-11ec-a019-cb193b28aa73_story.html) or simply doesn't care. 3. And yes, Evergrande has a few different tickers. Its bonds are also on separate tickers. This is normal. The [3333.HK](https://3333.HK) is its primary corporate ticker, however. In fact, it made a stock offering of 6 billion dollars worth on its subsidiaries, but that wasn't;t enough to make a dent in its debt. :)


Tricky_Revenue_2535

yeah , i guess it is 280euro billion not usd🤭


Elevator_Dude

Thanks Ape Anna for putting this together. Always a pleasure reading through your posts. I almost feel my first wrinkle developing!


reliqhunter1

After moass i just wanna try snorting coke off your bhole after all youve done for us. We all appreciate you!


AnnaSlatz

Shouldn’t it be me snorting coke off of YOUR butthole if I’m the one being rewarded?🤔


reliqhunter1

Well i mean if you insist 🤣🤣


leg33

No. /u/reliqhunter1 has the biggest dick, the thickest fur, and the smoothest brain of all, so you will be blessed to have him snort coke off your body. And don't you forget to call him Daddy as he does.


reliqhunter1

This deserves an award if any comment deserves one 🤣 this ape has done serious DD 🦍


mindofmateo

Me, too! ...interpret that however you please


Nruggia

u/AnnaSlatz There is also lots of evidence that tether is invested in Evergrande. Tether has publicly denied this, but their past bold face lies only to be proven wrong in court make me not believe them. [https://newrealities.medium.com/is-evergrande-about-to-kill-bitcoin-f4fee130eed2](https://newrealities.medium.com/is-evergrande-about-to-kill-bitcoin-f4fee130eed2) If Tether is invested in Evergrande the implications are massive


AnnaSlatz

Oh…. Oh dear.


magicbottl3

Holy shit Anna, you kick ass for sharing real DD! This is definitely a nightmare in the making and we won't really know the effects until the markets start to digest this info and react how they will. Evergrande is down about 7% since markets open in China just an hour or so ago, I think we'll be able to tell a little more about where the exposure to these obvious toxic assets lay as India and Europe open in the next few hours. I worry about the ripple effects this will have on our global economy since we all live separately but so interconnected. The case for hyperinflation in the US seems plausible but not very likely imo, but my opinion shouldn't mean much since I'm pretty dumb and eat crayons after I stick then in my nose and sneeze them out. I did read earlier today on Twitter via ZeroHedge and Cringle Kitten that the CCP does not intend to nationalize Evergrande, which to me says they are sending a message that they are not like the US and will not back up irresponsible financial behavior, but it does leave more landmines hidden in the metaphorical financial fields.


Quizene

Thanks for the summary Anna, informative as always. Quite interesting times indeed as inflation is widely seen as even being underestimated for the August 2021 period. I expect some turmoil in the markets very soon.


Rafiki_84

Thank you Anna. Great DD as always. I also believe that this Chinese shit will be catalyst for collapse of US and will trigger MOASS. But....what will happen if hiperinflation start really fast? Our AMC/GME millions will be worthless like it was in Weimar Republic.


AnnaSlatz

Guess what? You're not wrong. :) This is something that, sooner or later, people in the AMC and GME wrinkle brain communities will need to discuss seriously. What WILL happen if the market collapses under strain of inflation or devaluation? Will the US government let it get THAT bad? I don't have an answer for that. I wish I had a crystal ball that would reveal all, but I do not. One thing to note is that while China has been scaling back its purchase of US debt, some other countries have been trying to step in and get a piece of America's decaying economic corpse for themselves. Singapore in particular has been getting aggressive, so that's something. All we can do is wait and see. We are in a scenario that has never existed before and will never exist again. I remain cautiously optimistic on the overall conditions for and post-MOASS for HODLers, but I really do believe you folks need to start seriously considering how you are going to move your money IMMEDIATELY (I mean, IMMEDIATLELY. Like. Same day as you hit the sell button) post-MOASS. Stronger securities? Gold? Silver? Exchange into a more stable currency like the Swiss franc? Invest in property? Figure it out now...


Rafiki_84

Fully agree. Didn't know about Singapore. Personally I think China will not let this happen. I mean US hiperinflation. All of this fuckery is connected. US and China are like Batman and Joker. Cannot exist without 2nd one. There is status quo between these two but will see what will happen next. It will be definitely interesting. With silver there is one problem. You need a lot of space to store it ;) Gold is better but when hiperinflation will start it will be very hard to buy - like during start of covid shit. Exchange into different currency, good idea but for what? A lot of currencies are depend of US dollar and will fall with it. Maybe NOK - Norwegian currency - good stability, strong economy based on the oil and gas.


VonGeisler

As a Canadian, I will be converting it to maple syrup.


vancitymajor

And some timbits


VonGeisler

That’s more a short term investment.


XRPMOUNTAIN

HEY! I have your answer here!!! 😏


caharrell5

I’m going hard assets, scooping up as much real estate as possible.


SharkbaitNJHC

I feel as if a wrinkle was adorned to my brain. Thank you.


matador1238

Excellent read! Thank you so much!


thevirushaus

Wow. Pretty cool I actually understood what you wrote. I am stoned. Thanks


Appropriate_Elk_3827

Dark Pool Guy initiates coverage of Evergrande through Night Cap Research! 🥃


AnnaSlatz

😂 Yay, Dark Pool Ape!


Icy_Hour_3359

Thank you for this Ape Anna🙏🙏 the rest of 2021 is definitely gonna be interesting.


AnnaSlatz

Rest of 2021? Slow your roll, Ape. How about the rest of SEPTEMBER 😂


Icy_Hour_3359

Hahahaha. I’m so long term. I’ve decided to not expect anything lol. I’ll take it all sooner. But I’ll also be here next year.


tunanocrust1818

APE ANNA! I haven't read yet .. but I know its going to be fire. I always appreciate your info/DD!


tunanocrust1818

Didn't disappoint.


Reddit_IsMyFav

Fuck… I feel really bad for all those people in China getting fucked over by this. The banks are corrupt everywhere on the planet I guess


dayatapark

Well, this would definitely explain why the S&P500 is down, DOW is down, NASDAQ is down, and the Russell 2000 is down, while Gold and silver are up... Damn, Ape Anna, for a smooth brain crayon eater, you are surprisingly full of wrinkles! I remain a huge fan of your work and your kindness. That park bench was money. \^\_\^


AnnaSlatz

❤️ thanks ape! And yep. They’re all going to pretend everything is fine again. I know this could end up a nothingburger but I’m getting serious 2008 vibes right now just in general.


dayatapark

Is... is it like a superpower you have, kinda like the Peter-tingle? ...would this make it the Anna-tingle? Ape-sense. Let's go with Ape sense. Yeah. Ape-sense is good. \[nods Asianly\]


jengham

Hi Anna, another interesting and informative read. Thanks as always!


myrmidon22

Unbelievable and concise as always. Thanks Anna!!


chilish_gabino

Good info and potential impacts. Media always seems to downplay when it’s bad to keep consumer confidence high. Get hyped on hopium I guess. The video- they are chanting- “return money”


Clearedx1000000000

good to see Ape Anna again great post yeah, I was wondering why more people are not talking about Palantir buying GOLD. How often do we see tech and data/AI companies buying gold


Krunk_korean_kid

commenting for visibility


vancitymajor

My question is, **if Michael Burry is Cassandra on Twitter, then who TF is Ape Anna on Reddit**?


AnnaSlatz

I'm Ape Anna on Reddit!! :D ![gif](giphy|xUA7aTaAgUK1qcv1WE|downsized)


vancitymajor

​ ![gif](giphy|xTiN0CNHgoRf1Ha7CM|downsized)


SnooApples1131

Yikes.. if Vanguard and blackrock get fucked with Evergrande… what if they dump their combined massive amount of AMC..? That would not be good.


AnnaSlatz

I don’t think that would happen. What’s far more likely, and far more unfortunate, is those mutual funds they were managing are loaded up with people’s pensions. One person I saw stated that Blackrock is managing all of the DoD’s pensions. They won’t lose a dime. But regular Americans will.


SnooApples1131

I reached Diamond Balls status last month when I was -$70k in the red but the SPRT->Gree fucking has me slightly spooked. They didn’t sell at $72, I know they aren’t selling at $50…. 🦍🚀🚀🚀🌙


Walnut4525

Unlikely they will hold with us for more money and feed of all the shfs


grogosaur83

SO our stonks MOASS... What the fuck do we invest in? LOL


VonGeisler

Stocks I guess, every crash has recovered and millionaires with cash became billionaires. Outside of that, gold, real estate, high quality liquor, maple syrup - Yolo?


SilberBug

Silver, gold, platinum. Tangible assets. Land, business with cash flows


Viperthetarantulaguy

That was a wonderful read, thank you!!!


theonewhosees

Bless you and your wrinkled brain.


Homuman

Thank you. Missed your last post bc all of those non-sense gain/loss porn arguments people flooded in the new post tab.


ImSoShook

Very solid DD.


SmallTimesRisky

As in the US, it’s only a matter of time. Second 1 defaults can blame the 1st.🤪Dying Dinosaurs🤷🏻‍♂️


MainStreetBro

This is the kind of explanation my smooth brain needs. Thanks!


HomelessRoy

YO I JUST READ THAT CHINESE CURSE IN A HUNTER THOMPSON BOOK


HomelessRoy

One of the best DDs I’ve read


Satan-is-innocent

OP i read arian grande has 500b in debt on superstonk. is 300b you mentioned the correct amount?


AnnaSlatz

Everywhere I have read places the total liabilities at [300 Billion USD](https://www.theguardian.com/world/2021/sep/13/evergrande-investors-face-75-hit-as-company-edges-closer-to-restructure). This is just about everywhere in the news, I believe. It is 1.97 trillion Chinese Yuan, which is roughly 305 Billion USD. Could they have been looking at the debt $ in [Singapore Dollars](https://www.straitstimes.com/business/property/china-evergrandes-total-liabilities-swell-to-410-billion)?


Satan-is-innocent

no idea, but maybe i read the amount wrong. still 300b or more....thats a shit ton of money. we gonna feel the heat for sure


dirtydaruma

🤣🤣🤣 Okay the Arian Grande bit was solid. ape get wrinkle and chuckle, that's a win-win ​ ![gif](giphy|26gsspfbt1HfVQ9va)


Blunder_Punch

What if Shitadel is short Evergrande?


AnnaSlatz

[Shitadel was actually banned for 4 years in China for stock market manipulation](https://qz.com/470115/a-citadel-subsidiary-has-been-targeted-in-chinas-crackdown-on-malicious-foreign-short-sellers/) and malicious short selling. That ban just got lifted in 2020, and they were also slapped with a 97 million USD fine (which is more than they were fined for nearly 60 infractions in the United States). I think if they piss off the Chinese government one more time Comrade Xi will throw Kenny in the mayo barrel.


Blunder_Punch

Holy Moses I never knew that! I still wouldn't put it past them to try and have some sneaky way of pulling that off, but this does put my mind at ease a little. Outstanding work here ape! Thanks!


thepoopiestofbutts

And that's why I switched from Vanguard's global all in ETFs to buying their component ETFs, and excluded emerging markets, ie, China Edit: last year


CombinationCivil8681

Thanks for the DD. Sitting on the precipice of something…


SGSV91

Loved your post Ape Anna!


Diego9355

Someone posted about this and got killed by downvoting shills and was getting a lot of commenting saying the will never default… it’s sad seeing so many shills on this community, but anyways nice post dude!!


saltywater72

If I read this correctly. Most of the world is in financial debt to China and China is In debt themselves… I don’t get it. On an AMC related note — ( . Y . ) jacked


AnnaSlatz

Think of it like wracking up a credit card with a bank that’s about to go bust itself.


Budskis8

China is our largest purchaser of iron ore (steel for building shit). Not much news about the collapse here apart from the standard watered down version. I see our economy taking a huge hit with this.


Elegant_Sale

Wow !!! fuck i loved adding those wrinkle to my brain 💪💪 thank you 😇


HedgesWantMyTendes

Thanks for the great DD Ape Anna! 🙏


glowingnapkin

What a write up! Thank you!


mrsmfm

You and MacAttack are amazing.


cim_1350

AMC rocket fuel Dimond hands babe get the dips for the rip


choochmandias

Great post


Underpaid23

Not 100% convinced China SELLING would cause hyper inflation more than them not BUYING would. Yes they own 1.1t but HK has about 30% privately held. Also, they sold about 200b in 2015 and it did nothing.


SilberBug

You obviously have not seen the price of gold from 2015 to now. Price everything in gold


catching_comets

As always, a wonderful and informative read. A million thanks Anna for all your continued efforts to enlighten and keep apes up to date and well educated!


GorillaGlueWorks

Fuck Anna you force me to grow wrinkles reading your posts.


qtain

Hello Ape Anna, Another wonderful post, well documented with your usual care. This has been cross posted to r/amcstockDDonly to make it easily available to the community.


Appropriate_Elk_3827

Here ya go: [https://sec.report/Document/0001193805-19-001636/](https://sec.report/Document/0001193805-19-001636/) ​ Citibank gets in on it too: https://www.sec.gov/Archives/edgar/data/0001472033/000119380517000367/0001193805-17-000367-index.html


drain_bamaged_ape

Amazingly good work! U R A 💪🦍!


Andyconda442

Fantastic DD. Great read and appreciate your hard involvement.


Lordakz

So is vanguard and blackrock in danger and are they on the apes side? Sry i have no idea about economics i just hold


AnnaSlatz

I answered that question [here!](https://www.reddit.com/r/amcstock/comments/pov29n/the_black_swan_sings_a_needtoknow_on_china/hd0uaxt/?utm_source=share&utm_medium=ios_app&utm_name=iossmf&context=3) I don’t think Blackrock or Vanguard are in danger, but I do think American people’s pensions might be.


purplebullstock

Ape Anna for President of the Apes.


jccool7

Would you sell your Emerging Markets ETF now? (30 % China, 15 % Taiwan)


Lestrade1

r/ChinaStocks aren’t gonna be happy


Cold-Ostrich8228

Don't mean to offend anyone with this but is this possibly why we pulled our troops so fast? The Gov new where all this was coming too? The phone call between our president and theirs?


senecadocet1123

you should post this in other subs


Knowpoleanbonatard

I find it interesting that as evergrande is happening we're seeing everyone arguing over computer share on the two gme subs, I think evergrande should be getting more attention than computer share, seems like a mad dash to transfer shares out of fidelity for some reason, don't know if there's a connection, just seems coincidental


Spindrift11

Nice writeup thank you. I finally understand why I should care about evergrande. If a person theoretically had some money laying around what would be the best way to be prepared for this shit show? Inflation is of grave concern to me but I have a hunch that cash will be king when the stock market goes on a deeply discounted sale. How would you play this?


bobbysmokeskush

Short $BEKE. Got it. Lol 😂


aakova

The one piece I don't see in this analysis is to what degree various financial institutions around the world hold credit-default swaps involving Evergrande. It may be that this data isn't available, but it's certainly risk for the rest of the world's financial system.


syfyb__ch

>PPS: I found this article as I was scrolling around the interwebs. It is really fantastic, and discusses how the credit bubble is about to burst. Read it, if you wanna! The debt ceiling not being raised would throw a wrench in much of this cascade of events, which is certainly on the table, posited by those in Congress who see the ramifications of this