Since 2020, Evergrande has fallen into an unprecedented debt crisis, which has not only put Evergrande itself in jeopardy, but also affected China's real estate market, financial market and social stability. In this crisis, the detention of Xu Jiayin, chairman of Evergrande, has uncovered three incredible truths about this financial predator.
Evergrande under the debt crisis
Evergrande's debt crisis is comparable to the financial world, with a series of problems such as broken capital chains, debt defaults, owners' rights protection, and intervention. This is not unique to Evergrande, but is the result of a long history of China's real estate industry, with excessive borrowing and over-reliance on sales that make it immediately abyss if the market fluctuates.
The absurd truth of being **
However, what really surprised people were the three incredible truths behind the Evergrande crisis.
1.Ocean Flower Island's "All Eyes on You".
Evergrande's 100 billion real estate investment in Hainan, which is planned to accommodate hundreds of thousands of people, now looks like it may have been lost. Ocean Flower Island was originally a project with high expectations, however, when the crisis came, this island project, which was hailed as "much anticipated", became overshadowed. Huge investments and ambitious planning have become a thing of the past in the crisis. This reminds us that companies with deep pockets are often prone to bankruptcy overnight.
While the outlook for Ocean Flower Island is bleak, we should also see some of the deepest problems in China's real estate sector. Relying too much on the real estate business and making overly impulsive investment decisions can become fatal injuries when the market fluctuates. As an investor, thinking carefully about your portfolio and avoiding concentrating too much on one industry is the key to preventing risk.
2.The "ups and downs" of tens of billions of investment
The Evergrande football team used to be a giant with tens of billions of investment, but now it has long fallen to the middle league to play, and relegation has become a huge problem. In China, there is an old saying that goes: "If you develop too wildly, bad luck is not far from you." Xu Jiayin's extreme crazy investment made the Evergrande football team plummet from its peak. This phenomenon is also a reminder to investors that pursuing extreme investments can lead to extreme outcomes.
For the Evergrande football team, it is not only the story behind a sports event, but also a microcosm of corporate culture and financial strategy. Team building that relies too much on individual financial resources can lead to the collapse of the entire team if an individual is in trouble. That's why companies need to pay more attention to diversity and sustainability when developing their financial strategies.
3.The "vanishing magic" of hundreds of billions of investment
Evergrande Automobile, which is also an investment of 100 billion yuan, has now almost become a castle in the air. In this era of technology inspiring innovation, the silence and discoloration of Evergrande Automobile are incomprehensible. Investing huge sums of money but it is difficult to see Evergrande Automobile in the market, this can't help but make people wonder if there is a disappearing magic. Whether Xu Jiayin has the ability to turn this disappearing magic into a miracle of rebirth has become the focus of market speculation.
Looking to the Future: The Game of Risk and Investment
The outbreak of the Evergrande crisis not only surprised investors, but also became a classic case of risk management and investment decision-making. Investing is not all smooth sailing, but a journey full of twists and turns and risks. Through an in-depth analysis of the Evergrande crisis, we are able to more clearly understand the importance of financial management and the huge risks that extreme investments can bring.
In this turbulent moment of the global economy, investors should always keep a cool head and rationally analyze the changes in the market. Evergrande's fate also reminds us that the laws of the financial world are not very humanly controllable, and only by acting cautiously can we find a balance between risks and opportunities.