Afternoon Coffee: US single-family homebuilding declines again; Loss of French submarine deal strains relations with allies; China and the Evergrande debt crisis looms Thursday

Afternoon Coffee: US single-family homebuilding declines again; Loss of French submarine deal strains relations with allies; China and the Evergrande debt crisis looms Thursday


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US single-family housing starts fell for a second month, with August’s figures down, according to data released today.

It signals further concerns about a lack of materials and labor in the marketplace overall, and CNBC reports that the housing sector could be a drag on the overall economy in the third quarter.

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In a silver lining, multi-family home construction has increased due to the Covid-related need for more rental properties, and the price of lumber has come down from sky-high levels, CNBC reports.

France, EU take on allies in submarine deal

France is rallying the European Union to its cause after its submarine contract fell through with Australia, which worked out a separate deal with the US and UK.

“It’s a matter of trust,” a French official told reporters. “When you have your word, it has some value between allies, between democracies, between partners, and in this case, this word was not respected … so of course it creates a breach of trust.”

The rift could affect EU-Australian trade talks. And the development further strains relations with the UK, which left the EU and still has many Brexit issues to resolve.

Big China debt decision on Thursday

As China’s Communist Party pays more attention to how businesses there are run, a momentous debt decision looms Thursday on Evergrande, a Chinese real estate development company facing default on tens of millions of dollars in debt. A collapse could have serious ripple effects for China’s economy, and global investors are monitoring the situation, the Associated Press writes in a broad look at the issues.

“Evergrande was caught out by new limits regulators imposed on real estate-related borrowing as part of the Communist Party’s marathon campaign to reduce reliance on debt,” the AP reports. “Economists have been warning China’s rising debt is a potential threat for more than a decade. The ruling party has made reducing such financial risks a priority since 2018.”

CNBC has an article on what investors should know about the Evergrande deal.

Look for more news on AvidXchange’s IPO

Later today, Spend Matters PRO will publish an analyst-team look at the issues as the AP automation/payments provider AvidXchange plans to go public. Check here for updates.

How do you find the right procurement technology and vendor for your company? Spend Matters’ new 5-step “Procurement Technology Buyer’s Guide” can help — with how-to documents, checklist templates and other tips.


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