Finance
BHP CEO expects a turnaround in China’s property sector in year ahead
The company logo adorns the side of the BHP gobal headquarters in Melbourne on February 21, 2023. – The Australian multinational, a leading producer of metallurgical coal, iron ore, nickel, copper and potash, said net profit slumped 32 percent year-on-year to 6.46 billion US dollars in the six months to December 31. (Photo by William WEST / AFP) (Photo by WILLIAM WEST/AFP via Getty Images)
William West | Afp | Getty Images
BHP CEO Mike Henry said he expects China’s property sector to rebound in the upcoming year on the back of favorable government policies.
While acknowledging that the country’s property sector is a “weak point” for steel demand, Henry is optimistic about the suite of measures the Chinese government has announced recently.
“The government has enacted policies recently that are meant to support the property sector… We expect that we could see a turnaround in the property sector in the year ahead,” Henry said.
In recent months, China has rolled out a slew of measures aimed at stabilizing the country’s property sector, which once purportedly accounted for about 25% to 30% of the country’s GDP. For example, Beijing scrapped the nationwide minimum mortgage interest rate and reduced the minimum down payment ratio for first-time buyers to 15%, compared to 20% previously.
In May, the central bank also announced it would allocate 300 billion yuan ($42.25 billion) to financial institutions to lend to local state-owned enterprises for purchasing unsold apartments that have already been completed.
On Saturday, China’s minister of housing Ni Hong said that there is still “great potential and room” for China’s property sector to expand as the country continues to urbanize and demand for good housing continues to grow.
BHP reported a 2% climb in its annual underlying profits on Tuesday, attributing the growth to “solid operational performance and higher commodity prices in key commodities.”
Henry noted, however, there is still “a bit of volatility” with respect to China’s steel demand, which has been under pressure from the property sector.
But the CEO said there are still other sectors in China that contribute to steel demand that are growing quite healthily, such as infrastructure, shipping and automobiles.
Australian shares of BHP were 1.97% higher in Tuesday trading.
‘The Big Money Show’ co-hosts discuss buy now, pay later spending options and the impact it will now have on your credit score.
Small, everyday purchases like a meal from DoorDash are now able to be financed through eat now, pay later options — a practice that some experts deem “predatory.”
“You’ve got to have enough sense to not follow the urge to finance a taco, okay? You have got to be an adult,” career coach Ken Coleman told “The Big Money Show,” Wednesday.
“This is predatory, and it’s going to get a lot of people in deep trouble.”
RISKS OF BUY NOW, PAY LATER: ‘TICKET TO OVERSPENDING,’ EXPERT SAYS
DoorDash and Klarna are now partnering up to extend buy now, pay later options to consumers. (Reuters, Getty / Getty Images)
Financial wellness experts are continuously sounding the alarm to cash-strapped consumers, warning them of the devastating impact this financial strategy could have on their credit score as some lenders will begin reporting those loans to credit agencies.
Consumers may risk getting hit with late fees and interest rates, similar to credit cards.
“So your sandwich might show up on your FICO score, especially if you pay for it late,” FOX Business’ Jackie DeAngelis explained.
EXPERTS WARN HIDDEN RISKS OF BUY NOW, PAY LATER
Major players like Affirm, Afterpay, and Klarna have risen to prominence at a time when Americans continue to grapple with persisting inflation, high interest rates and student loan payments, which resumed in October 2023 after a pause due to the COVID-19 pandemic.
Ramsey Solutions personal finance expert and ‘The Ramsey Show’ co-host George Kamel discusses the ‘buy now, pay later’ craze and the trend that celebrates the financial benefits of being childless.
“The Big Money Show” co-host Taylor Riggs offered a different perspective, suggesting that company CEOs have a “duty” to attract as many customers as they want.
“Unfortunately for me, this always comes down to financial literacy — which I know is so much in your heart about training people to save now by later,” she told Coleman, who regularly offers financial advice to callers on “The Ramsey Show.”
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Coleman continued to come to the defense of financially “desperate” consumers, arguing that companies are targeting “immature” customers.
“I’m for American businesses being able to do whatever they want to do under the law. That’s fine. But let’s still call it what it is: it’s predatory, and they know who their customers are,” Coleman concluded, “And I’m telling you, they’re talking about weak-minded, immature, desperate people.”
FOX Business’ Daniella Genovese contributed to this report.
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