[Sticw]

This was the overall picture of what the banks have loaned to China's private sectors including households in 2022.  Looking forward to the 2023/24 chart.

The chart shows that China's household debt is 60% of GDP and the rest is from private enterprises and institutions which might include LGFV. 

The US has a totally different picture

What does this entail then for China and USA?

[revealer]

When there is no more stimulus,  the property index come trumbling.  Soon it will go back to lower lows if the 200 MA is broken. Those having mortgage loans will b in stress again.

https://imgur.com/a/LGiLQjP

[cityhantam]

When there is no more stimulus,  

https://www.scmp.com/economy/economic-in...-takeaways
. 
.

[revealer]

In China, housing loans r subject to unlimited liability, or a recourse loan. In the event of default, the owner's property may be forced to be auctioned by the bank. If the auction proceeds r dnot enough to repay the loan, the bank also has the right to pursue other properties in the owner's name. The situation is the same in Japan and Singapore.

In the US, most housing loans r on limited liability. The owner can just vacated and surrendered the property to the lender.

[aiptasia]

In China,  housing loans r subject to unlimited liability, or a recourse loan. In the event of default, the owner's property may be forced to be auctioned by the bank. If the auction proceeds r dnot enough to repay the loan, the bank also has the right to pursue other properties in the owner's name.  The situation is the same in Japan and Singapore.

In the US,  most housing loans r on limited liability. The owner can just vacated and surrendered the property to the lender.

Putting red herring distractions doesn't settle the issue that Americans are neck deep in debt.

Fugging FLG pundek PTOOI!

[Niubee]

A mortgage is still a debt except it is tied to an asset. It is better than ordinary debt only when the asset is not depreciating. When the asset is depreciating, it is a double whammy. The mortgage owner not only has to pay the bank interest rate but also the losses in the asset value. One will have to wait for the next pricing cycle. For housing assets, it is usually around 7 years, meaning for the next 7 years, they will suffer more than the owners of the ordinary debt.

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