There is not much going on in the news in China this week and our view would be this is because on one side everyone has decided the economy is NOT GOOD and they know Those in Command are busy working on the package aimed at restoring confidence that will be unveiled in July at the Third Plenum. We got a hint of similar concerns from the Center on Thursday, with Mr. Xi delivering his most pro-business message in a while at a meeting with SOEs, private entrepreneurs and overseas investors.
But what exactly the plan will be is, of course, not yet clear. When it’s announced the thing to watch is how many empty apartments are going to be bought up at what price, what they declare they will do with all the debt in various parts of the property market, and how they plan to balance off economic development and national security. Big stuff. Then we will see whether people buy it. So in the meantime, we will refrain from further speculation and move on.
Of what did happen, the standouts were that overall tax revenue slipped 2.7% in the first four months of this year compared to last year, which means less money to spend on buying apartments for a start. And the once-high flying consumer electronics company Suning defaulted on a debt payment and so lost control of Italy’s top football team, Inter Milan. Own goal.
Have a great weekend.