Surreal estate... Last week, markets wobbled as Chinese property giant Evergrande missed an $83M payment — and it’s just the tip of a $300B debt iceberg. Investors fear that Evergrande's collapse could cause a Lehman-esque global stock slump, and throw markets into turmoil. If Evergrande defaults, its financial partners, including HSBC, BlackRock, and UBS, could lose big money. Investors are watching to see if Evergrande will come up with the cash during its 30-day grace period — or miss more payments.
You're gonna need a bigger boat... More like a higher ceiling. Quick refresher: The US Treasury’s borrowing is limited by a “debt ceiling.” If it needs more cash, it asks Congress to raise the cap. Now, the US needs a higher ceiling to cover trillions worth of Covid expenses, but Congress can’t agree on a limit. If a deal doesn't happen, the US could default on its debts for the first time. Analysts say there’s a 20% chance of default, which could wipe out as many as 6M jobs and $15T in wealth.