With interest rates at subatomic levels, “zombie” companies continue to defy the laws of physics. As discussed in ZH below, “it started in December 2017, when the IMF published a blog discussing the “Walking Debt: China’s Zombies” (a topic we first covered in October 2015 in “More Than Half Of China’s Commodity Companies Can’t PayContinue reading “Zombie Apocalypse”
Category Archives: Credit Risk
Red Ponzi Defaults
Like Red Ponzi issues? Like cliff diving? Catching falling knives? As WSJ reported in their story, it’s been a lot of “unwelcome surprises” for those who believe Red Ponzi financial statements (too funny – there are such people). Sort of like those who believe there is no voter fraud. Yongcheng Coal & Electricity Holding GroupContinue reading “Red Ponzi Defaults”
Housing Heat
Systemic Risk in the Red Ponzi
According to Reuters, Beijing now wants a full accounting of everything going on at local developers. “The government is monitoring everything now, unless you want to cheat, but they will be able to tell from your monthly figures,” said a senior executive at one of the developers in the pilot scheme. Following concerns of too much developerContinue reading “Systemic Risk in the Red Ponzi”
Loss Loss Reserves – and CECL Relief
With Senator Chuck Schumer covering their backs under CARES Act stimulus, mega banks don’t need to think much about reserving for losses on financial instruments under Current Expected Credit Losses or CECL (pronounced Cecil). So, what kind of reserves are indicated? A lot less than the Crash.
Econophysics2020 