Indebted Chinese Real Estate Developer Could Become Systemic Risk

Sep 21, 2021

2 min

John Sedunov, PhD

Recent speculation surrounding the property developer China Evergrande Group caused the S&P 500 to have its worst day since May. But what we should look out for is systemic risk, according to John Sedunov, PhD, associate professor of finance at Villanova University.


Evergrande currently has the biggest debt out of all publicly traded real-estate management or development companies. “The big issue seems to be Evergrande’s ability to repay its debt. The bigger issue is a potential for systemic crises or contagion to unfold,” said Dr. Sedunov.


Another possibility is that Beijing could allow Evergrande to default. “Evergrande is a large Chinese developer, and the Chinese government may allow it to fail. It owes a lot of money to financial institutions and other market participants,” says Dr. Sedunov.


With these risks, assets were moved from stocks, oil and Bitcoin to much safer options.


“What’s potentially at stake is a contagion event where institutions with large exposure to Evergrande experience distress or fail as a result of lost cash flows they are expecting from Evergrande. This scenario is exacerbated if the company is allowed to fail,” said Dr. Sedunov.


Does this present any other future concerns?


Per Dr. Sedunov, Evergrande’s collapse could also impact the housing market. “More at issue is also that the real estate sector in China looks to be quite overheated (and it may be here as well), and this could be a signal of a collapse in real estate values, which again can bleed back into the financial system,” he said.



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John Sedunov, PhD

John Sedunov, PhD

Professor of Finance and Real Estate | Villanova School of Business

John Sedunov, PhD, is an expert in banking, cryptocurrencies and financial institutions.

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Pope Leo XIV Paid Public Homage to Saint Augustine in Algeria, but Has Invoked His Teachings Since Election, Says Augustine Scholar Paul Camacho featured image

6 min

Pope Leo XIV Paid Public Homage to Saint Augustine in Algeria, but Has Invoked His Teachings Since Election, Says Augustine Scholar Paul Camacho

During his historic trip to Africa in April 2026, Pope Leo XIV toured the archaeological ruins of Annaba, Algeria, capping what he referred to as a “special” journey to the country. Annaba, where the ancient city of Hippo Regius once stood, is not far from where Saint Augustine—patron of the Augustinian order to which the Pope belongs—was ordained, made bishop and crafted his most influential theological works. Walking in his footsteps, Pope Leo—who referred to himself as a “Son of Augustine” upon his election to the papacy—toured the ruins with other members of the Order and his traveling party. It was a personal and symbolic moment, but for those paying close attention to his early pontificate, it represented only the most recent of many tributes he has paid to Augustine and his teachings. “In reading through Pope Leo’s addresses and his homilies, his messages and his video recordings, there is barely one that goes by without him referencing Augustine in some way,” said Paul A. Camacho, PhD, associate director of The Augustinian Institute at Villanova University, and scholar of Augustine’s teachings. When the Pontiff accepted the Saint Augustine Medal from the Augustinian Province of St. Thomas of Villanova in August 2025, he made it clear why. “As Augustinians, we strive every day to live up to the spiritual example of our spiritual father, Saint Augustine,” he said to the Province. “To be recognized as an Augustinian, it’s an honor held dearly. So much of who I am, I owe to the spirit and teachings of Saint Augustine and I am grateful to all of you for all the many ways your lives exhibit a deep commitment to the values of Veritas, Unitas and Caritas.” Veritas Examples abound related to all three values and how Pope Leo has invoked Augustine in speaking about them. Dr. Camacho cites a handful he found particularly noteworthy. For example, Veritas first appeared in an especially prominent way during an early address for the June Solemnity of the Holy Trinity and Jubilee of Sport. Then, Pope Leo said, “This combination of Trinity and Sport is somewhat unusual, yet the juxtaposition is not inappropriate. Every good worthwhile human activity is in some way a reflection of God’s infinite beauty, and sport is certainly one of these.” “For Saint Augustine, the Trinity and wisdom are intimately connected,” Dr. Camacho said, also mentioning that Augustine authored an entire book on the subject titled “On the Trinity.” “Divine wisdom is revealed in the Most Holy Trinity and wisdom always leads us to Veritas—the truth," he said. “What Pope Leo goes on to do is say that the life of God, the Trinity, is a life of play…It’s a dance, and dance is a sport, and our own way of participating in that kind of activity is a participation in life of God.” When Pope Leo later spoke to the International Foundation of Catholic Universities—an occasion for which the motto was “Choreographers of Knowledge”—he referenced that dance again. “Pope Leo invites us to think of our relationship to Veritas not as something to master,” Dr. Camacho said. “But rather as a light that draws us out of ourselves towards it, in a dance of relationship with it and one another.” Unitas During a September Mass for the General Chapter of the Order of Saint Augustine, Pope Leo prayed that those in attendance be given “the gift to listen, the gift to be humble and the gift to promote unity within the Augustinian Order, and throughout the Order, throughout the Church and the world.” Earlier in the summer, he touched on unity during the Jubilee of Families, Children, Grandparents and the Elderly, commenting on the Gospel of John, in which “Christ prays that we may all be one.” “This being one is the greatest good we can desire, for this universal union brings about among his creatures the eternal communion of love that is God himself: the Father who gives life, the Son who received it and the Spirit who shares it… the Lord does not want us in this unity to be a nameless and faceless crowd,” Pope Leo said. “What Pope Leo expresses here is that unity is not conformity, but rather community—the kind of community in which each one of us becomes more of who it is that we are the more we love and work for what is good in common,” explained Dr. Camacho. “This is a deeply Augustinian insight.” In one general audience with members of various religious groups, Pope Leo relayed “Unity has always been a constant concern of mine, as witnessed by the motto I chose for my episcopal ministry.” He was referencing, Dr. Camacho says, the Latin phrase In illo uno unum, displayed on his coat of arms. “That phrase—‘in the one [Christ] we are one’—comes from Saint Augustine’s commentary on the Psalms. Pope Leo comes back again to this idea that when we love and follow the truth that is Christ, we simultaneously become more uniquely individual, and our unity becomes genuine community, and not mass conformity.” Caritas In his Opening Homily for the Beginning of the Pontificate, Pope Leo followed his salutations with these words: “I greet you all with a heart full of gratitude at the beginning of the ministry that has been entrusted to me. Saint Augustine wrote: ‘Lord, you have made us for yourself, and our heart is restless until it rests in you.” According to Dr. Camacho, Augustine taught that the solution to the restless heart is Caritas, or rightly ordered love that finds its rest in God. Augustine’s thinking about love is developed in a social dimension when he distinguishes between two different kinds of political communities, which he calls the “Earthly City” (in which pride and self-love dominate), and the “City of God” (in which love of God and neighbor form the community). Augustine’s enduring and influential work “De Civitas Dei,” or “City of God,” articulates this distinction between false and true loves. At the 16th Annual Meeting of the International Catholic Legislators Network, Pope Leo suggested that we look to Augustine, citing his own witness of social upheavals in his time, and that we consider Augustine’s reminder that we must attend to these “two orientations of the human heart.” “Ordo amoris—order of love,” explained Dr. Camacho. “This is Augustine’s notion that following Christ is not a matter of private devotion, but rather demands a dilation of our hearts: our loves must move out to embrace the poor, the marginalized, the downtrodden, the forgotten. In Catholic Social Thought, this is the principle of solidarity: while the things that we love begin with what is most intimate to us, we are called to expand our love outward. One of the things Pope Leo is trying to say is that Augustine’s thought remains a living inspiration for how we might organize our societies.” Speaking to the International Interparliamentary Union in late June, Pope Leo intimated that Saint Augustine speaks of “your responsibility to promote and protect, independent of any special interest, the good of the community, the common good, particularly by defending the vulnerable and the marginalized.” “Augustine’s idea was that what makes a community is what its members love in common,” Dr. Camacho said. “In other words, Caritas—love—is fundamental to how we think about how we relate to one another. Not just on a one-to-one, personal level or in terms of a private relationship to my own good, but rather how we relate to our communities, and what we build together for the common good.” “Bringing Augustine Back to the World” One of the great gifts of the Augustinian Order, says Dr. Camacho, is that “because of its charism of community, it draws individuals to become religious from all walks of life, and not just those who have extensively read or studied the work of Augustine.” It is especially noteworthy, he says, just how entrenched Pope Leo’s words and actions are in his long-time study of Augustine. “It is quite clear that Pope Leo loves Augustine, not just as an exemplar, as a patron saint of the Order, or as a doctor of the Church—though he is all of these. Leo loves Augustine as a companion: a man whose life reminds us that discipleship is about fidelity and not about perfection; a thinker who is rich in philosophical and theological insight; and a priest and bishop who cared deeply for his community. “In his pontificate, it is already clear that Pope Leo, this great “Son of Augustine,” is bringing Augustine back to the Church and to the world as a vital source of wisdom and inspiration.”

Villanova Tax Experts Break Down Legislative Changes, Best Practices Before Filing Deadline featured image

4 min

Villanova Tax Experts Break Down Legislative Changes, Best Practices Before Filing Deadline

It's time to collect your W-2s, 1098s and 1099s: On April 15, Americans are required to submit their annual tax returns—recapping earnings, income and life events from the past calendar year. Yet, as filers prepare their records and statements for 2025, they should anticipate some substantial departures from the 2024 season. According to Stephen Olsen, JD, faculty director of the Graduate Tax Program at Villanova University Charles Widger School of Law, and Luke Watson, PhD, associate professor of Accounting in the Villanova School of Business, one of the most significant drivers of change is the One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025. A sweeping piece of legislation, OBBBA has instituted a number of new tax rules and regulations, including a deduction of $6,000 for taxpayers over 65 years of age, a deduction for certain overtime payments up to $12,500, a deduction for certain tips up to $25,000 and an increase in the state and local tax (SALT) deduction cap from $10,000 to $40,000. Given these policies, most taxpayers should expect a modest decrease in taxes owed this season, and refunds on average should trend higher than in 2025—something borne out by early data from the U.S. Department of Treasury. Of course, the full extent and range of the windfalls have yet to be discovered. "It is unclear if the average refund will be as high as estimated by the administration or what the actual distribution of those tax benefits will be," says Professor Olsen. "Not every taxpayer will receive a significant benefit, and there are so many factors that could cause someone's tax bill to increase, including increased taxable income, the loss of other deductions, changes in filing status and claimed dependents." "There are also many restrictions and phaseouts that changed with OBBBA," adds Dr. Watson. "For example, many seniors and tipped workers paid little to no income tax even under prior law, so they would not necessarily see much benefit with the new legislation." As Dr. Watson's remarks reflect, the question of who exactly qualifies for and benefits from OBBBA's provisions has preoccupied the general public for quite some time. In particular, the deduction-related measure tied to tips, or the "no tax on tips" policy, has sparked curiosity. "Like many things in the Internal Revenue Code, 'no tax on tips' sounds simple, but the actual law is a bit more nuanced," says Professor Olsen. "Only workers who are in an occupation that 'customarily and regularly' receives tips qualify for this deduction. This includes lots of people in transportation, personal services and the food, beverage and hospitality industries—even some in entertainment. "Certain professions, including those in healthcare, law, accounting, financial services and consulting, will likely be prohibited from taking the deduction… Importantly, qualifying workers will need to be able to prove their tip income to take the deduction." "It is also worth noting that, due to the generally lower-wage nature of tipped jobs and the historical underreporting of tips on returns, many taxpayers earning tips paid little to no tax on tips in prior years," says Dr. Watson. "So, they would not experience much of a change under OBBBA." Navigating new provisions like this one, during a process and time already known for provoking anxiety, can be a daunting prospect for many taxpayers. What's more, administrative adjustments at the Internal Revenue Service (IRS) could potentially exacerbate levels of stress. "IRS staffing remains lower than in past years, which could impact customer service and processing of returns," says Professor Olsen. "In addition, the current administration has elected to eliminate the IRS Direct File tool for income taxes that was available last year. Taxpayers who used the tool last year will need to find other options for the preparation of their income tax returns." For those concerned about filing and worried about abiding by the new rules and regulations, Professor Olsen and Dr. Watson highlight the importance of remaining organized, maintaining a game plan and, if necessary, seeking assistance. "First, taxpayers should be proactive," says Professor Olsen. "Start gathering information as soon as possible and start the process of preparing your returns as early as possible. That will provide you with more time to troubleshoot issues or find other information you may not have initially gathered." "Free resources are also available for taxpayers," says Dr. Watson. "There is a federal volunteer-run program called Volunteer Income Tax Assistance (VITA) that operates throughout communities to prepare tax returns for free, and many of the big tax prep companies do offer a free version of their software, despite trying very hard to sell a paid version. "That said, the best advice is to keep thorough tax and financial records throughout the year. Then, seek help—such as through VITA—when you need it. The better your records, the easier it will be for VITA or others to assist you."

Elevation of John Henry Newman to Doctor of the Church Stands Out Among Pope Leo's First-Year Actions featured image

4 min

Elevation of John Henry Newman to Doctor of the Church Stands Out Among Pope Leo's First-Year Actions

Pope Leo XIV's first year as leader of the Catholic Church was marked by observation, listening and careful communication, and was largely devoid of major doctrinal or political action. As reasonably expected of a new pontiff, he issued his first major document—the apostolic exhortation Dilexi te. He also embarked on his first international trip, traveling to Türkiye and Lebanon, where he celebrated the 1700th anniversary of the Council of Nicaea. But perhaps publicly overlooked was his elevation of a 19th-century saint to Doctor of the Church—a designation reserved for saints found to have made significant contributions to doctrine and spirituality through writings and teachings. After approving it in July 2025, Pope Leo issued that designation to St. John Henry Newman on All-Saints Day, making him only the 38th individual given the title. "The move to make St. John Henry Newman a Doctor of the Church was already underway, but Pope Leo verified it and actually carried it out, bringing Newman into a newfound kind of prominence," said Michael Moreland, PhD, professor of Law and Religion at Villanova University Charles Widger School of Law, and a scholar of St. Newman. A Bridge Between Anglican and Catholic Theology Newman, considered an influential individual in the shaping of modern Catholic theology and education, was not always Catholic. Born in England in 1801, Newman became an Anglican priest in his mid-20s. He later was a prominent leader of the Oxford Movement—one intended to recover elements of traditional Catholic heritage in Anglicanism. It led to the birth of Anglo-Catholicism and caused many Anglicans to convert to the Roman Catholic faith, including Newman himself. Newman was received into the Catholic Church in 1845 and was ordained a Catholic priest in 1847. He would go on to become an influential theologian for his contributions to the ideas of faith, conscience and doctrine. "He established what he called the 'evolution of the doctrine'—the idea that the deposit of faith is not something immobile, but something that grows in awareness over time," said Luca Cottini, PhD, professor of Italian Studies at Villanova University. "He [Newman] was also a person of the university; an intellectual," said Dr. Moreland. "He was known for his voluminous writings on all kinds of issues, including his famous book 'The Idea of a University.'" In 1878, Pope Leo XIII made then-Father Newman—who was not even a Bishop at the time—a Cardinal. Like the current Pope Leo, the elevation of Newman was one of Pope Leo XIII's first acts of government. "It's an astonishing resemblance between our current Pope and his namesake," Dr. Cottini said. "Both recognized this important theologian and his contributions to Catholicism within the first year of their papacy." Newman died in 1890 and is remembered as an influential theologian, scholar and an important bridge between Anglicanism, Catholicism and the modern world. He was beatified in 2010 by Pope Benedict XVI and canonized by Pope Francis in 2019 before Pope Leo XIV elevated him to Doctor of the Church. Newman's Promotion Shrouded in Significance Beyond its relative rarity—only five individuals have been promoted to Doctor of the Church since 1971—Newman's elevation is significant in many ways, according to Dr. Moreland. "He was an Anglican by birth who converted to Roman Catholicism," he said. "He was someone from the English-speaking world, not from continental Europe, and he was from the 19th century, which is relatively recent in this context." Newman is only the second Doctor of the Church from England, and aside from Thérèse of Lisieux, born in 1873, is the only Doctor of the Church born after 1700. Beyond the significance related to Newman himself, Pope Leo's recent action underscored a critical focus of the Church, and evidenced its personal importance to the pontiff himself. "It highlighted Newman's role in education," Dr. Moreland says. "That is something Pope Leo has been formed by in important ways: as a seminary rector, seminary professor and as part of the Order of St. Augustine, which values education highly." At the Mass elevating Newman to Doctor of the Church, Pope Leo also named Newman a co-patron saint of Catholic Education, joining 13th-century priest and theologian St. Thomas Aquinas. He then added Newman’s feast day of October 9—the day he converted to Catholicism in 1845—to the General Roman Calendar, thus bringing his memorial to the global Church. "I think Pope Leo elevating Newman to a Doctor of the Church, along with these subsequent actions, signifies the emphasis he is going to place on education during his papacy," Dr. Moreland said.

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