Eurodollar University HSBC’s "China Crisis Is Far Worse Than Anyone Imagined"
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Aug 15, 2025 HSBC reveals alarming risks in its Hong Kong real estate loans, spotlighting the region's deepening financial turmoil. The discussion dives into how the ongoing credit crisis is crippling banks, raising questions about previous economic strategies. With banks prioritizing government bonds over new loans, the potential for economic growth and stability is under serious threat. Insights into the M2 money supply growth reveal a troubling landscape, hinting at broader implications for both China and Hong Kong's economies.
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HSBC Reveals Hong Kong Credit Shock
- HSBC flagged a massive rise in risky Hong Kong commercial property loans, revealing a deepening credit crisis.
- This problem ties into a broader global fatal flaw from pandemic-era distortions, says Jeff Snider.
Banks Misread China's Recovery
- The HSBC losses illustrate how global bank strategies misjudged China's post-pandemic outlook and are now suffering.
- Snider calls this a universal fatal flaw that leaves many banks exposed and economies impaired.
Hong Kong As A Harbinger
- Hong Kong's commercial property slump is symptomatic of a wider credit crisis that extends beyond the city.
- The Hong Kong story provides clues about how similar problems progress on the mainland and globally.