Bloomberg - Evening Briefing - Country Garden’s next test

Distressed Chinese developer Country Garden Holdings is approaching another deadline for voting by bondholders on its request to extend repayment on a security after winning support on 10.3 billion yuan ($1.4 billion) of other local notes. The voting is set to conclude Thursday night 10 p.m. Beijing-time. The bond is the last in a group of eight notes that it asked to stretch repayment on by three years, with extension of the other seven having already been approved. Country Garden has become a symbol of a broader property debt crisis that’s led to record defaults and prompted Xi Jinping’s government to scramble in an effort to avoid more contagion. More widely, the builder must sort through 1.36 trillion yuan ($187 billion) of total liabilities before its next major test when a $1 billion note matures in January. Investors everywhere will be keeping close tabs on the giant developer’s effort to keep afloat. Any stumble could impact China’s housing market even more than a landmark default in 2021 by Evergrande Group—seeing as Country Garden has four times as many projects. Such a collapse could have dire consequences for the Chinese economy while inflicting global collateral damage. —David E. Rovella

Arm Holdings is said to have priced its initial public offering at the top end of its range to raise $4.87 billion in the largest listing of the year. The chip designer, which is owned by SoftBank Group, is selling the American depositary shares for $51 each. Arm had marketed 95.5 million shares for $47 to $51 each.

Citigroup is preparing for a wave of employee terminations as Chief Executive Officer Jane Fraser launches the biggest restructuring of the Wall Street giant in two decades, part of her effort to reverse a years-long slump in the stock price. The company will now operate five main businesses and eliminate the three regional chiefs who oversee operations in about 160 countries around the world. At least four of Fraser’s senior deputies got new roles in the shakeup, and the firm is looking for a head of banking, which includes oversight of the investment-banking unit. As for how many Citigroup employees will lose their jobs, the Wall Street giant hasn’t said yet.

Jane Fraser Photographer: Valerie Plesch/Bloomberg

The US Treasury logged a rare surplus for the month of August as the department accounted for revenue from student-loan payments, reflecting the Supreme Court’s invalidation of the Biden administration’s move to forgive the debt. The federal government had an $89.2 billion surplus for August as officials added $319 billion to revenues Last year, the administration’s student-loan plan had added to the budget deficit. The August move effectively reverses that.

In the US Senate, former college football coach Tommy Tuberville continues to block Pentagon promotions, garnering accusations that the Alabama senator is endangering national security and a rare rebuke from Senate Minority Leader Mitch McConnell. Now in the House, hardliner Republicans are barring debate of a measure to fund the US military, a slap in the face to Speaker Kevin McCarthy just one day after he launched an impeachment inquiry into President Joe Biden that the GOP’s far-right members had sought.

The European Union is launching an investigation into Chinese subsidies for electric vehicles in a bid to ward off a flood of cheap imports, an escalation that opens the door to retaliation which could hit the bloc’s carmakers hard. Taking an unusually aggressive stance, European Commission President Ursula von der Leyen said on Wednesday that the global market is overrun with cheap Chinese cars and that the bloc will fight back.

Ursula von der Leyen, president of the European Commission, delivers her state of the union address to the European Parliament in Strasbourg, France, on Wednesday. Photographer: Stefan Wermuth/Bloomberg

The Chinese government’s position on Apple grew more muddled Wednesday, with Beijing both pushing back on reports about iPhone restrictions but also raising concerns about security problems with the device. “China has not issued laws and regulations to ban the purchase of Apple or foreign brands’ phones,” Foreign Ministry spokeswoman Mao Ning told a regular press briefing in Beijing on Wednesday. But he added that Beijing attaches “great importance” to security and that all companies operating in China need to abide by its laws and regulations. The remarks left US investors unsure about Apple’s status in China—which is both the company’s production base and its biggest international market.

Once known as the murder capital of the world and home base to Pablo Escobar, perhaps the most famous drug lord that ever lived, Medellín wasn’t what one would have considered to be a travel destination. But times have changed. As violence ebbed, a revival took hold as the Colombian city welcomed new investment and visitors from abroad. Backpackers roaming the streets became a common sight. Now Medellín has a new problem: too many tourists.

Medellín Photographer: Edinson Arroyo/Bloomberg

• Just when you thought US inflation was under control, this happens.
• Bloomberg Opinion: Biden impeachment inquiry marks US low point.
• Kroll’s message to critics: the data now proves ESG makes money.
• Mitt Romney announces he won’t seek re-election to the US Senate.
• No-show workers add wrinkle to Stellantis union contract talks.
• MGM, Caesars hacked by “Scattered Spider.” Caesars paid millions.
• “Star Wars” video-game director Stig Asmussen leaves Electronic Arts.

Three months after its July 2022 debut on the Nasdaq, FaZe Holdings, a “lifestyle and media platform rooted in gaming and youth culture,” threw an exclusive party at a San Diego nightclub, hiring the rapper Travis Scott to promote its stable of video-game stars and YouTube personalities. Social-media influencers mingled with gamers in expensive streetwear. Well past midnight, Scott appeared for a 15-minute show, his voice barely audible over the thumping bass. The party, which cost $1.7 million, got the company and a sponsor’s name in hundreds of Google search results, YouTube videos and Instagram stories. Lee Trink, FaZe’s chief executive at the time, hailed the event as a great success. “We achieved all of the things we would have hoped for, including making money,” he said in an interview after the party. Now the party is over.

Nordan “FaZe Rain” Shat, a company co-founder, wears a necklace with the FaZe logo at the company headquarters in Los Angeles in July 2022. Photographer: Kyle Grillot/Bloomberg

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