Fully agree, time will tell exactly what the plan is. But nothing happens by accident, China has needed to reset the housing market for a while and this is one way to do it. There is a lot of doomsday talk surrounding Evergrande but I think reality is average people in China will benefit from lower housing prices. How the government will manage this is an open question. China has been a seller's market for a while, seems like it may now become a buyer's market. China will benefit either way, US media always likes to create panic.One of the reasons why Evergrande is facing a crisis now is because the Chinese government set 3 red lines and effectively put the brakes on Evargrande's plans to expand further and attain further financing. Home ownership in China is at 90%, whereas in the US it's at 60% and a large portion of homeowners in China own 2 homes.
The Chinese government will most likely confiscate Evergrande and its assets along with the assets and funds of the greedy tycoons who caused this mess to prevent a massive meltdown. In China everything is planned, nothing happens by accident. With Lehman Brothers, everyone was in the dark until the last minute. This is not the case with Evergrande.
The Chinese reaction to this crisis will be the exact opposite of the American reaction to the recession, which was to use taxpayers money to bailout large corporations. The people behind the 2008 crisis not only got away with it, they all got their bonuses as well, funded for by the US taxpayer. In China, the Communist party reigns supreme, whereas in the US, capitalists reign supreme.
Yes in the last 2 years the USA has printed more money than in the last 100 years. Many western countries have reacted to Covid by borrowing a ton of money and have been giving out money to their citizens like candy. This has led to higher prices and inflation on many household items / staples.
Honestly if the US economy does end up facing some kind of great depression scenario then surely China will take the opportunity to ask export consumers for various kinds of currency instead of only USD as they do now. I'm predicting they might ask Europe for Euros, North America for USD and Asia/Africa for their own RMB (Yuan).
Of course in that case, the USA will feel enraged seeing China as an existential threat to it's position as the worlds sole super power. US war hawks and defense contractors, after Afghanistan, are also clamoring for a war with China and if you recall last time there was a depression in the US it was followed by WW2, which got the US to bounce back from the depression if you recall.
The US will seek a war with China to get out of its slump and retain global hegemony. That is simply their natural instinct. They will fabricate something, anything to ignite a war with China. I expect some sort of provocation or false flag operation, like the chemical weapons attacks in Syria or Gulf of Tonkin incident.
However only time will tell if history will repeat itself, or if this century the unipolar American world order will give way to a new multipolar global order.
ALSO oil prices will most likely rise during a global conflict rather than go down. A depression would cause prices to fall but again I believe that any depression will be quickly followed by a major conflict between the US and China.