🔥 China’s Latest Property Shock: Vanke Just Broke the Last Illusion 🔥
Vanke, once viewed as China’s “safe” developer after Evergrande, just stunned markets. It’s asking for a 1-year delay on a ¥2B bond with zero upfront payment and even the interest pushed back a year. Creditors expected support. Instead, they got nothing. 📉 The fallout: ➡️ Bond crashed from near par to ¥27 ➡️USD notes collapsed to 20 cents ➡️Analysts warn this “shatters investor confidence” Vanke is now pledging core assets, being rejected for emergency loans, and facing warnings that its commitments are “unsustainable.” This isn’t one company’s problem — it’s the latest sign that China’s 5-year property downturn has no bottom. Home prices continue to fall, sales data is going missing, and global banks see years of decline ahead. And with China’s middle class holding most of its wealth in property, a deeper slump could be devastating. The crisis is no longer at the fringes. If Vanke is wobbling, the entire foundation is shaking. Source: zerohedge
Imagine buying a 100-year Austrian bond only to see it trade at about 25% of the value you bought it just a few years ago
🚨🚨 Ouch!! Source: FT
🚨 Major investors are DUMPING Japanese government bonds:
The Bank of Japan, domestic banks, insurers, and others have net sold -¥10.7 TRILLION in Japanese Government Bonds (JGBs) in September, the most EVER. Demand for Japanese debt is falling; no wonder yields are rising. Source: Global Market Investors, Bloomberg
The gap between UK borrowing costs and other advanced economies isn't just persisting, it’s widening:
A stark reminder of the "UK premium" currently baked into markets. The more this "UK premium" embeds itself in the public finances, the higher the risk of a self-feeding vicious cycle. Source: FT, Martin Wolf
In case you missed it... US 10-Year Treasury Yield back near its lowest level in the last 14 months 📉📉
Source: Barchart
An important chart to watch: Investment grade credit default swaps are seeing a meaningful divergence from ORCL CDS
So no contagion at this stage Source: zerohedge
IG tech spreads are wider than the broad index for the first time since 2012...
Source: zerohedge
Why You Always Watch Japanese Rates.
Source: The Market Ear @themarketear
