From last week;
China bond defaults are forecast to climb after a state-owned steelmaker missed an interest payment, raising questions about the government’s commitment to stand behind such firms.
Sinosteel Co. failed to pay interest due Tuesday on 2 billion yuan ($315 million) of 5.3 percent notes maturing in 2017 after saying it will extend the deadline as it plans to add a unit’s stock as collateral. That came after the National Development and Reform Commission planned to meet noteholders and ask them not to exercise a redemption option on Tuesday to force full repayment, people familiar with the matter said last week.
h/t Melinda.
Why should Chinese taxpayers pay to prop up loser government owned corporations? Let them go under in a paced and structured way and let the free market (as free as it can be over there) scavenge and salvage what productive remains there may be, even if it is just scrap metal.
Maybe we could let more of our own crown corps go bust.
I certainly wouldn’t want to disparage so I’ll use the initials Canadian Broadcasting Corporation as a hint for my humble suggestion.
“Why should Chinese taxpayers pay to prop up loser government owned corporations?”
Because there’s a gun to their heads.