The $170 Billion Collapse of China’s HNA Group

My thanks to my intern researcher Adam Kim for his help on this video

Links:

[bohanxu]

"Why should I lend you so much money for this collateral?"
"I have government connection. Just trust me bro~"

[magnetospin]

Fundamentally the problem with these acquisitions is the company overpaid. If the acquired asset is worth what the company paid then there really isn't a debt issue.

[igchek]

dude your channel is basically bloomberg with indie humble vibes. Kepp going, you are awesome

[soldiersvejk]

In its original territory, Hainan Airline actually did quite well. Pretty much all Chinese students in Massachusetts have flown from Beijing or Shanghai on HNA.

[dulio]

Chinese banks are legendary in their insanity. One time we went to withdraw money from a bank and we were told to come back in two hours. Apparently the jag-off running it deposits the bank's deposits to other banks to earn interest. So the teller actually ran out of the bank to withdraw the banks money from another bank.

[freekfaro]

I actually flew with Hainan, from Guilin to Sanya, in 2000 ... Small plane. Two Chinese pilots, assisted by a very big German guy sitting on a stool just behind them. All visible to the passengers because the cockpit door wasn't closed!

[RocketGurney]

An asianometry video release always makes the day a good one. I appreciate how you just give a factual explanation of the history of the subject matter without any need for flash or flair. It makes things like this very easy to digest, ecen for a layman; I never even heard of HNA before this video.

[willbee]

Credit for putting this together. One can’t help but shake one’s head. If it’s feels too good to be true, it often is, too good to be true.

[kevinbarry]

I just love it when these companies tout their alleged connections to the Chinese government; They are simply appealing to the investors greed by essentially saying, yes this thing is all corrupt and a mess, but don't worry you will benefit from it. Of course it's nonsense, when the bonds come due, the government is not going to pay you

[uwanttono]

Fantastic research and a fantastic and informative vlog. Well done to all involved!!

[TorteInYourFace]

I remember reading the news about Frankfurt-Hahn Airport being sold but for some reason the investor would not show up and could not be contacted. It was actually treated like a scandal for the regional government since the public opinion was that they fucked up the due dilligence. There were articles about this for weeks in german newspapers. Thanks for giving me the background to this story I already forgot 😂

[TJ-vhps]

Wow, what an amazingly detailed, yet comprehensible history and discussion of a very complex topic! This sort of deep dive into recent history is extremely valuable in helping the public understand how some of China’s largest companies grew as quickly as they did, and why so many are running into trouble, now that the Chinese government is paying attention the the debt levels of its largest borrowers.

[Randrew]

Very interesting topic - thank you for this presentation! I (American citizen) did a lot of business travel to and in China in the early and mid '90s. Then in the 2000s my wife booked a ticket to visit her family in Beijing on a Chinese airline I'd never heard of before: Hainan. It puzzled me at the time that an apparently brand new Chinese airline could appear that wasn't part of the original China family of airlines. Of course as a whole lot of financial constructs are busy unraveling in China, this story of HNA Group birth and collapse now makes a lot of sense.

[iwbxcvr]

your research is always so detailed. your video always very informative.

[Hmework]

Airline companies all around the world are running on razor thin margins. US airlines like United and SW are mostly in the credit card industry. Many airline's value is not their flights or planes, like how Amazon is actually AWS and the nonprofitable Amazon site.

Seems like this integration is just inevitable.

[henryD]

I just want to say that I understood, comprehended, analyzed and cogitated over everything you said. A total and complete understanding was achieved. It was very simple. Or maybe not. Anyways, I don't know what's going on with these people

[normanknutsen]

Thank you very much for the video. Im a commercial aviation fan so heard hna group's name a lot and noticed Hainan Airlines flew some international routes that seemed pretty marginal.

[bixdryp]

Damn man. This makes the south sea company look honest and transparent in comparison.

[abelardoruiz]

1. Have a lot of connections
2. Get your connections to lend you a lot of money
3. Use the lend money to buy other businesses and stock
4. Put family members and you with insane salaries in top positions
5. Bankrupt the company because of the high leverage.

[tsuchan]

Your videos are stunningly well researched. My thanks too to your researcher on this.