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2017-07-20 — wolfstreet.com
Bank of America's decision to pull out of any deals with HNA shows the concerns other US and European banks must have as well, and that they too might be getting second thoughts about the risks of doing business with Chinese conglomerates, especially since even Chinese authorities are loudly fretting about the exposure of their own banks to these conglomerates, and their fear that the conglomerates threaten China's very fragile financial stability.
When banks step back from an opportunity to make vast sums of money because they finally see the risks, it's the moment the music stops for these conglomerates. That's when debt cannot be refinanced or serviced anymore. That's when the whole multi-layered debt constructs come tumbling down, and when Chinese authorities come face to face with their own black-swan event.
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