I think the glut is not so severe in tier 1/2 cities, its the tier 3/4 cities that are in a massive bubble, and many developers have huge developments in those cities so thats a big problem.
Whatever the CCP chooses to do they better act quickly, real estate is 20-25% of the economy and 70+% of Chinese household wealth is trapped in real estate, there is no real prospect of any meaningful economic recovery if this sector doesnt recover.
On the subject of recovery, the current foreign investor belief like yourself is that property drives most of the growth, thus if no return in property market, no growth and no foreign funds for China. This is consensus foreign view. We can also tack on de-globalisation/shifting of supply chains to other countries.
For readers' benefit, the following video interview of Chine Beigebook summarizes this viewpoint very well including the stagnant near-term outlook:
https://www.cnbc.com/video/2023/12/...iver-in-china-for-the-next-several-years.html
I want to emphasize: That is TODAY.
When the crash came, people stopped buying projects and the money stopped flowing.
The China banks who lent money to finance all this are of course now stuck with a mountain of toxic assets which is why ever so often, we see stories of bank runs or banks freezing accounts and not allowing withdrawals.
If this has already been reported, then the market has priced this in.
The trouble with debate about stocks is my debate focus on the time frame in the FUTURE, while bears are still talking about today's priced in facts and the associated lack of any solid bullish evidence.
Well, just use Huawei as a reference example for China's future corporations. Alibaba is also innovating. Just because they are behind and late to the game, does not mean they are any less capable.
I don't know if you have any experience running your own business. If these are your competitors, you should revere them, not disregard them.
https://edition.cnn.com/2023/12/29/tech/huawei-revenue-rebound-china-intl-hnk/index.html
Huawei was once fighting for its survival. It is back to nearly $100 billion in revenue in 2023
Unlike Japan's rigid age-based seniority in corporations, China's corporate culture is ruthless.
Here is the write-up about PDD and get the truest sense of how very different it is from Japan's rigid corpses.
https://www.baiguan.news/p/how-does-the-internal-management
How does the internal management of Pinduoduo operate?
Anyway, I'm not here to win any debate right now, because near-term outlook is still bearish.
The purpose is to reference to these points I publicly made in HWZ forum if my insight prove to be correct in the future.
