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[Citation needed] for your capital flight claim. It is not as simplistic as you think. Super rich people in China or India use similar financial instruments as

by shas3 11y ago

[Citation needed] for your capital flight claim. It is not as simplistic as you think. Super rich people in China or India use similar financial instruments as those in the US to diversify, ensure good ROI, etc. Yes, US is a more stable economy. But there are smarter and more straightforward ways to tie yourself to the US growth rate than buying up a condo in Champaign, IL. Also will it shock you to learn that people desire a US education because it is the best in the world? One way to think of it, if you can afford them: German luxury cars are among the best, so you buy a BMW or Merc; Italian sportscars are among the best, so you buy those; Milan and Paris fashion brands are among the best, so you buy those; likewise, US (along with UK 'Oxbridge') education is the best in the world so you go for that.

handedness 11y ago
http://webcache.googleusercontent.com/search?q=cache:CPXQS_vRgOQJ:www.ft.com/cms/s/0/ae4dee44-bf34-11e5-9fdb-87b8d15baec2.html+&cd=7&hl=en&ct=clnk&gl=us http://webcache.googleusercontent.com/search?q=cache:CPXQS_v... http://www.bloomberg.com/news/articles/2016-01-14/china-s-capital-flight http://www.bloomberg.com/news/articles/2016-01-14/china-s-ca... http://www.bloomberg.com/news/articles/2016-02-07/key-to-china-holding-back-capital-dam-seen-in-boosting-economy http://www.bloomberg.com/news/articles/2016-02-07/key-to-chi... http://www.telegraph.co.uk/finance/economics/12134684/Time-running-out-for-China-on-capital-flight-warns-bank-chief.html http://www.telegraph.co.uk/finance/economics/12134684/Time-r... It's a fairly common symptom of a financial crisis, and putting your family up in a new country and loading up on assets there is one of the more outwardly visible symptoms of it. (Again, see Japan's history–the data's in the OP's article.) China's zero-unemployment policy have created some incredibly unsustainable trends, and they know it. Meanwhile, Beijing has to figure out how it's going to keep a nation that would span about five time zones unified, when they have a wealth disparity like the world's never known. India, meanwhile, is destined to remain incredibly capital poor, despite being able to feed itself pretty handily. If you're a wealthy Indian elite, you're capital rich but constrained by your local geography. Combine in the negative-interest-rate policies many countries have adopted, and the money's absolutely going to migrate away from that (as low as rates are elsewhere, they're still higher). Anyway, I don't think wealthy Chinese nationals are limiting themselves to buying a condo in Champaign, IL. But when you expatriate large amounts of currency, winding up with a house and a few supercars in the destination country isn't a rare phenomenon. And yeah, the colleges are good, too, but they were also good when we had comparatively few Chinese students attending them, too.
handedness 11y ago
Addressing your later edit: > One way to think of it, if you can afford them: German luxury cars are among the best, so you buy a BMW or Merc; Italian sportscars are among the best, so you buy those; Milan and Paris fashion brands are among the best, so you buy those; likewise, US (along with UK 'Oxbridge') education is the best in the world so you go for that. Sure, but that doesn't explain the recent influx from China. Some of it's the artificial prosperity they created in the pursuit of a zero-unemployment/zero-revolt policy, but the reason it's changing is because their ship is sinking. When a given people suddenly avail themselves of BMWs or Mercs, Ferraris or Chanel bags, at astonishingly higher rates than ever before, it's not just because those items are the best available–they have been for decades–it's because there's now both the cash to fund such an appetite, and the motivation to do so.
contravert 11y ago
Yeah, just look at the trade deficit: https://www.census.gov/foreign-trade/balance/c5700.html https://www.census.gov/foreign-trade/balance/c5700.html Unless China is just giving the US manufactured goods for free, that money has to be buying something.

by shas3 11y ago

handedness 11y ago

http://webcache.googleusercontent.com/search?q=cache:CPXQS_vRgOQJ:www.ft.com/cms/s/0/ae4dee44-bf34-11e5-9fdb-87b8d15baec2.html+&cd=7&hl=en&ct=clnk&gl=us http://webcache.googleusercontent.com/search?q=cache:CPXQS_v... http://www.bloomberg.com/news/articles/2016-01-14/china-s-capital-flight http://www.bloomberg.com/news/articles/2016-01-14/china-s-ca... http://www.bloomberg.com/news/articles/2016-02-07/key-to-china-holding-back-capital-dam-seen-in-boosting-economy http://www.bloomberg.com/news/articles/2016-02-07/key-to-chi... http://www.telegraph.co.uk/finance/economics/12134684/Time-running-out-for-China-on-capital-flight-warns-bank-chief.html http://www.telegraph.co.uk/finance/economics/12134684/Time-r... It's a fairly common symptom of a financial crisis, and putting your family up in a new country and loading up on assets there is one of the more outwardly visible symptoms of it. (Again, see Japan's history–the data's in the OP's article.) China's zero-unemployment policy have created some incredibly unsustainable trends, and they know it. Meanwhile, Beijing has to figure out how it's going to keep a nation that would span about five time zones unified, when they have a wealth disparity like the world's never known. India, meanwhile, is destined to remain incredibly capital poor, despite being able to feed itself pretty handily. If you're a wealthy Indian elite, you're capital rich but constrained by your local geography. Combine in the negative-interest-rate policies many countries have adopted, and the money's absolutely going to migrate away from that (as low as rates are elsewhere, they're still higher). Anyway, I don't think wealthy Chinese nationals are limiting themselves to buying a condo in Champaign, IL. But when you expatriate large amounts of currency, winding up with a house and a few supercars in the destination country isn't a rare phenomenon. And yeah, the colleges are good, too, but they were also good when we had comparatively few Chinese students attending them, too.

handedness 11y ago

Addressing your later edit: > One way to think of it, if you can afford them: German luxury cars are among the best, so you buy a BMW or Merc; Italian sportscars are among the best, so you buy those; Milan and Paris fashion brands are among the best, so you buy those; likewise, US (along with UK 'Oxbridge') education is the best in the world so you go for that. Sure, but that doesn't explain the recent influx from China. Some of it's the artificial prosperity they created in the pursuit of a zero-unemployment/zero-revolt policy, but the reason it's changing is because their ship is sinking. When a given people suddenly avail themselves of BMWs or Mercs, Ferraris or Chanel bags, at astonishingly higher rates than ever before, it's not just because those items are the best available–they have been for decades–it's because there's now both the cash to fund such an appetite, and the motivation to do so.

contravert 11y ago

Yeah, just look at the trade deficit: https://www.census.gov/foreign-trade/balance/c5700.html https://www.census.gov/foreign-trade/balance/c5700.html Unless China is just giving the US manufactured goods for free, that money has to be buying something.