Stuff it punk.
Posted on 03/14/2016 5:58:43 AM PDT by artichokegrower
They’re not just buying RE - they’re buying stocks, bonds, businesses. In fact since they fund most of our budget deficits by buying our treasuries (government debt), they’re in essence funding most of our welfare.
Their people are working so ours don’t have to! What a deal!
This is a strong signal the bubble is soon to bust
Stuff it.
You can’t handle the truth. Deal with it.
And yes, they could buy American securities -- but only if they wanted those securities.
They'd have plenty of options, in other words.
Why is USDoT making top-down determinations that "we shall have densely-packed land use patterns and 19th-century transportation infrastructure", which one suspects is really an attack on the freedom of movement people enjoy with the automobile?
Why do I think that automobile ownership and storage will become "problematic" under this new dispensation, and who are the authors?
Why us DoT moving to restrict options, freedom, and elbow room? Who is deciding this stuff?
More to the point, who's making decisions the People should be making for themselves and their own families?
The Chinese prison system is actually a labor corvee. No wonder they're having no trouble underbidding First World producers and manufacturers.
There are drawbacks to trading with the Chinese .... how's your fish? Like some more melamine with that?
So what was the gnawing tooth that destroyed the value of their dollars in China, that would motivate them to take such a hit just to move those dollars into Stateside real estate?
Was their motivation really economic? What was their deal? Who was making the rules, that said "move your savings to the States ... and follow them there"? Why not just buy US REITs on Hong Kong markets?
I think you are misreading me, completely. There are easily half a dozen reasons.
First, the value of dollars in China is not as you say “destroyed in value”, on the contrary, dollars are dramatically appreciating in value. That makes assets valued in dollars and even better, spinning off interest or rent, even more valuable.
Second, Chinese in mainland China (I do not know this for a fact) probably have their money in Yuan. They do not own dollars and it may even be illegal for them to own dollars in size. I do not know. But the money they hold in Yuan (the internal form of their currency) is devaluing both as a result of the stronger dollar AND the efforts of the central bank to pump the economy via (what else?) devaluation of the local currency. So I don’t know exactly, but Chinese holding their own currency may have experienced a 15-20% deval over the past few months.
Third, many Chinese may well fear confiscation if somehow the amount of wealth they have is judged to be excessive. Deval is a 15% loss in purchasing power but confiscation is 100%, and likely, they would face jail time or some form of arbitrary punishment should they be found with “illicitly gotten gains”.
Fourth, it is a very strong tradition among Chinese to own real estate and especially rental real estate. This is what I posted. Commercial real estate in the US is evaluated using very standard benchmarks such as cap rates, internal rates of return, cashflows, etc. If you are a Chinese citizen looking to escape with your money and move into a deeded piece of income producing property in a country they want to go to anyway and in which there are very strong property rights, or face having the money confiscated or devalued further, then you will certainly overpay for what you consider a safer asset. Why do you think band yields crash when the stock market gets weak? It is because people rush to bonds out of fear, overpay for them, and stick themselves with crappy yields.
I don’t think Chinese are going to consider US REITS bought on the HK exchange with money the Chinese government is intent upon confiscating as being very safe. It would be clawed back, for sure. Such an investment may not be denominated in USDs, either. These folks aren’t looking for stock market investments.
I'm familiar with currency controls but wasn't aware $US are illegal to hold in China. I'm aware US firms are not allowed to repatriate any profits earned in China -- a continuation of the old imperial mercantilism that brought China the Opium Wars, and opium, and the destruction of the country's youth, indeed the Empire, the mandarinate, and much else.
Your reference to local inflation in China and exchange rates, and to the threat of political confiscation through phony legal proceedings, supplies the "tooth" I was referring to, the processes of value destruction that would move savers to act. So these are real Chinese savers, forced to become investors, by their fear of expropriation by the State and Party (but I repeat myself).
Still, how is it that so many ordinary Chinese of no particular entree obtain exit visas to travel permanently to the United States? How do they get their money out, deo nolente, in the face of official disfavor? I still don't get that one. There must be some form of official favor or fostering, that allows them to flow money and people out of China to the United States.
When Hongkongyan, 20 years ago, began their exodus to Vancouver, preservation of their savings was offered as a motive, and a credible one, together with fear of loss of property protections with the departure of the British.
But the current economic migrants have no protection, but appear to expose their transactions somehow -- what, do they just carry out suitcases stuffed with renminbi and sell them at the exchange shop in LAX? -- and to rely on something, to allow them egress to the States to be reunited with their money.
This suggests to me an underlying State policy of fostering and favoring emigration to the United States by Chinese with savings.
Thanks again for your reply.
Honestly, like you stated in your post, I don’t have the slightest idea of the mechanics of how Chinese get their money out. Nor do I know if it’s illegal for Chinese to own dollars or not. Just to clarify. But there should be little doubt that, standing on Chinese soil, a Chinese holding large amounts of dollars is in effect de-ratifying their own country and the presumption has got to be that they are plotting their escape. With their money. In that, the US is similar. If you have a load of cash in this country you are presumed illicit at some level.
But I *do* know that 1: They are very clever (in their way; not especially as originator-types, indeed, they are copycats writ large) 2: Even if only 1/4 of 1% of Chinese do something, whether it be getting their $$ out or stomping their feet in unison, it’s huge. 3: They are fiendish investors. The RE thing is very tied up in their devotion to family and what they wish to pass on to their children.
I have had many Chinese friends over the years and being Jewish, I find it mildly remarkable how similar Chinese are to Jews. They don’t have the creative mojo but they will work themselves to the bone to provide for their kids.
Stuff it punk.
Up yours, a**hole!
Up yours, a**hole!
The government is ALREADY intervening - by giving them green cards with a $500,000 purchase. And then they can start their own firm and even get government preference because they are “minorities”!
So the question still remains, is the Chinese government planning to ride on the backs of emigrants to the New World and then claim it when the numbers begin to tip?
They're showing a strong pattern of colonization and expansion reminiscent of the European experience in Africa and the Far East 400 years ago. They run the Panama Canal and are parlaying that administrative control into trading advantages for Chinese bottoms plying South America, in which they are displaying an interest beyond lively, and soon they'll have colony-cities on two of the greatest harbors on the Pacific coast. Remember, too, that they made a play for the former US Navy base at Long Beach as well.
You are sort of conflating the ChiCom party and what it wants to do with what individual Chinese want to do; as if the Chinese buying US RE are an advance guard for the Chinese state army and military. Naively, perhaps, I don’t think that’s the case. I think the Chinese who emigrate just want to make money, provide for their children, and live in a more civilized society. Let there be no doubt, plenty of them steal US corporate secrets and commit what we consider to be industrial espionage on a grand scale. No doubt, some of those who do so are “soldiers” of the PLA. Some here may view that as militarily hostile; some may view it as their culture which copies, copies, copies, and I make no excuse for it. But it’s not quite the taboo for them it is to us. I also have zero doubt that the ChiCom government actively encourages those Chinese who are here in high-level industrial positions where they can swipe valuable trade secrets to do so.
I am certainly willing to grant you that spies are spies and thieves are thieves, and that emigrees retain substantial allegiance to their native China.
I am opining that Chinese who steal trade secrets know exactly what they are doing. I just do not think it is being done via RE investment. There are spies who buy real estate and non-spies who do NOT buy real estate.
Maybe it would be mildly interesting to survey Chinese who have been convicted of spying in the US (or deported) and see if they bought real estate? After all, if you’re a spy and you get discovered, you’d want to jet out of the US stat. That’s very un-real estaty.
Think I could get a $673,000 grant to study that?
China devaluing huge tonight. Biggest since Jan 7th.
bkmk
Actually, though, I wasn't as interested in state or industrial or economic espionage as I am in demographic warfare of the sort that Mexican intellectuals have been waging for 40 years against the US, and which hijra-participating Moslem states and NGO's have now undertaken against Europe and North America, the latter with the open complicity of our traitorous Pres__ent.
My thought is that it will have occurred to the Chinese that, with support in the UN from Mexico, Iran, Russia, Cuba, and other America-hating countries, it might be possible to foment civil war in America, then seek to impose a new order on the People of the United States with the help of ethnic-dissident collaborators and a UN Security Council mandate -- the "blue helmets" scenario predicted by some of our accumulator-Galtist FRiends. The general idea would be to fracture the US along ethnic fault-lines and then, having planted pretextual hooks in the land, use the big Russian and Chinese armies to pull America apart like a baked chicken.
To do that, it helps to get "our people" (the overseas Chinese) into the game, and then push a beef against the racist evil honky etc. etc. American People in "our people's" name.
The play's been made before, and it can work -- as in Poland, in 1939.
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