12 ms·

$2T in Proceeds of Corruption Removed from China and Taken to US, AUS, CAN, NL

160 points by kspaans 10y ago

kspaans 10y ago
Interesting point on the Vancouver angle: Q: In Canada, where does the money end up and why? A: Vancouver is the preferred destination, by far, because of perceived more relaxed anti-money laundering on-boarding compliance and more importantly, easier access to better schools and lifestyle for children of Chinese foreign nationals.
- JumpCrisscross 10y ago
  What's the source of their Vancouver assertion?
  - raquo 10y ago
    Don't know their source, but I can confirm that relevant Canadian laws are wide open for abuse due to both being toothless and because of near zero enforcement, at both federal and provincial (BC) levels. You can google how CRA actively avoided auditing foreign buyers "for fear of racism allegations" (yeah right) or how people bring hundreds of thousands of dollars in paper bills on themselves and their children, paying only $2.5K if caught (cheaper than Western Union!). Or the latest Vancouver 15% foreign investor tax designed to appease the population, but wholly ineffective because it relies on self reporting which no one ever checks and allows for other obvious loopholes. Much better proposals were ignored in favour of this purposely flawed one. It's amazingly fucked up, I'm surprised Canadians are taking it so willingly.
    - aianus 10y ago
      > It's amazingly fucked up, I'm surprised Canadians are taking it so willingly. Nothing surprising about it, ~69% of Canadian households (and a much higher percentage of voters!) are homeowners and directly benefit from this influx of capital.
      - raquo 10y ago
        That home ownership rate includes everyone who lives in a dwelling owned by their family, so it includes the youth who lives with their parents because they can't afford to move out. Besides, all the home owners I know are not happy about constantly increasing prices either. Many of them think it's unfair, many don't like the foreign inflation aspect, and even pragmatically speaking it's harder to jump to owning a bigger dwelling now. So I don't know why this is going on, but it's not because most people want higher housing prices.
TaylorSwift 10y ago
What's wrong with keeping the proceeds in China?
- kspaans 10y ago
  From the article: China also has something called “grey” income, which means income earned (or acquired off the books) in China that is not reported on income taxes and that is held by its richest families. If the money can be laundered by buying a house overseas, grey becomes green!
  - eternalban 10y ago
    How is it "held"? I've seen reports of raids where they find houses stuffed full of cash, but how do you get $2T in cash to Canada? At some point this is getting converted to electronic funds and that is where the "laundering" is happening. As to why they are buying hard assets in Anglo-sphere, possibly because they are worried that the said Anglos may pull the plug on the fiat currency in a Great Reset at some point in the near future. I guess the silver lining here is that the Chinese corrupt set are bullish on the continuity of rule of law over here.
    - afterburner 10y ago
      HSBC is complicit in laundering the money. They have been fined to that effect, but I doubt it's curtailed their activities much. I'm sure many other banks do the same.
    - querulous 10y ago
      if you know the right people and can stomach hours and hours in the cheapest seats on transpacific flights you can make $2k a week flying between beijing and vancouver
    - webmaven 10y ago
      > how do you get $2T in cash to Canada? Shipping containers?
pizza 10y ago
Wonder how this correlates with the current growth of the US economy, and maybe more relevantly, how the top 1% seems to be increasing its wealth much faster than the rest.
jamhan 10y ago
In Australia we were supposed to have tranche 2 ("covering real estate agents, lawyers, accountants, car dealers and others") of the anti-money laundering regulations introduced over 10 years ago. As this article details, it is "comically" overdue: http://www.smh.com.au/business/banking-and-finance/slated-antimoney-laundering-legislation-is-comically-overdue-20150913-gjlb7j.html http://www.smh.com.au/business/banking-and-finance/slated-an... While political parties can wallow in the extra taxes garnered from sky-rocketing real-estate prices and sizable party donations they have no incentive to introduce this second tranche. For example, any party in power in New South Sales will keep its budget in the black simply from "stamp-duty" taxes collected on real-estate transactions. The Foreign Investment Review Board was and is a farce and that's how the government likes it.
a_bonobo 10y ago
This is a relatively big problem in Australia - there has been talk of a housing bubble in Australia for the last few years which in part has been propped up by Chinese grey money buying whole apartment buildings for investment, which drives up prices (they can just dictate prices) and keeps young locals out [1]. I cannot afford a house and I have a well-paying job. The government looks the other way since building is one of the last big job creators now that the mining boom is over. For example, there is a government body for foreign investment breaches (rules like you're not allowed to buy 'used' property if you don't have permanent residency, but I've personally talked to quite a few Chinese students whose parents did that for them) but it has never once initiated court action [2]. So everybody profits in the short term - Chinese corruption can move 'dead' money out of the country, Australian government gets to present itself as a job creator. Except young Australians, who have to rent and cannot rely on real estate property for their retirement. In the long term, the bubble is going to pop and then you have dead cities with empty high rises falling apart (but then again, people have been saying for at least 10 years that the bubble is going to pop any day now and it's still inflating) [1] Contains no numbers: http://www.smh.com.au/comment/grey-money-from-china-helps-blow-our-property-bubble-20140928-10n7a8.html http://www.smh.com.au/comment/grey-money-from-china-helps-bl... [2] http://www.abc.net.au/news/2014-11-27/foreign-buyer-rule-enforcement-needs-to-be-strengthened/5921518 http://www.abc.net.au/news/2014-11-27/foreign-buyer-rule-enf...
- kspaans 10y ago
  Except young Australians, who have to rent and cannot rely on real estate property for their retirement. This is orthogonal to the money laundering, but what's stopping the young people from investing for their retirement? Houses are not the only way to build savings.
  - a_bonobo 10y ago
    That's true, the Australian system of superannuation is actually pretty great, your job pays a portion of your income into your super which gets invested for you, you have some choice as to where it gets invested (high risk vs. low risk etc.) However what I fear is that if the super isn't managed well, inflation hits, or you just don't build up a large enough investment the high rental prices in Australia will eat up the majority of your investment returns.
codersbrew 10y ago
Is there a way to get the number of properties bought via a foreign entity? I'm sure with 3-4 different LLCs to shift cash through it's near impossible to tell.
sudeepj 10y ago
In India, "grey income" is called "black money". It is a hot topic in India right now. Recent activities on this: Note ban (Nov 2016) => https://en.wikipedia.org/wiki/Indian_black_money#Ban_on_1000_currency_notes https://en.wikipedia.org/wiki/Indian_black_money#Ban_on_1000... Using analytics (today's news) => http://economictimes.indiatimes.com/news/economy/policy/i-t-department-scanning-data-pile-to-dig-out-unaccounted-income/articleshow/56282112.cms http://economictimes.indiatimes.com/news/economy/policy/i-t-...
- LiweiZ 10y ago
  We Chinese call it "black money", too. But it sounds too harsh and directly pointing to crime when talking, esp. publicly. So the color is changed to gray meaning color between clear and black so that no one "overreacts" (when "black money" is normal, everywhere possible and most people deal with it do not end up in jail or are not being investigated"). Just a way people accept the reality.
- conanbatt 10y ago
  There is a distinction between corruption money and tax evasion. Hence the usage of gray vs black.
peteretep 10y ago
Wonder why the British Isles isn't in there; unlikely to be EU stuff as NL is on there.
andrewvijay 10y ago
I thought around 500 times to buy myself a car on christmas and then I see this
non_repro_blue 10y ago
That's a big number, way too large for anyone to take personally in an emotional sense. But it's definitely big enough for a purge. Jailing, disappearances and more. This is a pretty large economic tide. Almost twice the size of California's economy, all at once. Ranking it The Fifth Largest Economy, worldwide, if it's worth thinking in those terms. Given that an approximate number of participating Chinese nationals have been enumerated, if they suddenly disappeared (and ~20,000 is certainly within the realm of possibility), what would a sudden halt of two trillion (legal or not) do to the rest of the world?
- ac29 10y ago
  >This is a pretty large economic tide. Almost twice the size of California's economy, all at once. Well, not all at once, that number (USD 1.5T, the 2T number is CAD) is cumulative from 1995-2013, per the article.
  - non_repro_blue 10y ago
    You're right. I skimmed the numbers too fast.
- tajen 10y ago
  Can you rephrase the question? If a tide of $2T suddenly stops (but doesn't reverse), would the worldwide economy tank? Well, every change in flows can be seen as "a crisis", the question is where the money belongs in the first place. At worst, it has made the city of Vancouver (or rather the former landlords who exited by selling) richer for a while, and they will learn to come back to their previous richness levels. Which is still better than never having seen the tide of money at all.
- angry_octet 10y ago
  Remember, there are no Chinese 401k plans. There is no retirement plan except for what you save and your children provide. Hang on, you only have one child. And the stock market is just smoke and mirrors and you can't actually own land in China... This is just a trickle of the money that needs to be invested for retirement or a rainy day. Western economies were left totally flat-footed by this, a combination of greed and incompetence.
coygui 10y ago
I study at Vancouver UBC and rented a room in a house in the nearby area. I could tell that the Canadian government has started to investigate the corrupted $ because one day a government official came to "my house" and asked the information about the previous landowner. It seemed that he used the corrupted $ to buy the real estate and make more $
- ChuckMcM 10y ago
  I'll just say if you're using house sales in Vancouver or the Bay Area to launder your money you are really moving a lot of money around. I bought a house for cash in Las Vegas after the crash and the bank never once asked where I got the funds to do so. I'm pretty sure they were supposed to.
  - djrogers 10y ago
    > I bought a house for cash in Las Vegas after the crash and the bank never once asked where I got the funds to do so. I'm pretty sure they were supposed to. Umm, no. It only. I, but that's frightening. You have a right to privacy in a private transaction like that. Where you will run in to a ton of questions is when you use a big chunk of money for a down payment on a mortgage. In that case the bank wants to make sure you didn't borrow the down payment and get in over your head.
    - pjc50 10y ago
      The US has no general right to privacy, and all large transactions are potentially notifiable to the anti-money-laundering authorities. This is what HSBC got in a lot of trouble for not doing.
      - djrogers 10y ago
        Any notification would go as far as that - simple notification of a transaction. There's no requirement for the bank to investigate the source of your funds as part of a private transaction.
ygmelnikova 10y ago
I own a house in Vancouver. Let's just hold off until I can sell it, then crack down on this blatant corruption.
tehlike 10y ago
I wonder what ways US could prevent Chinese money buying real estate in the US? 1. Do what Vancouver did, add tax for foreign property ownership. 2. Tighten the checks on origin of money? How exactly, especially when it's coming as all cash? Maybe forcing it to go through a bank, where more thorough check is mandatory per IRS? But then again, banks are not the most trustworthy in this country. 3. Other ideas?
- Hondor 10y ago
  Why ban Chinese money, not local money or money from other countries? What's your actual goal? To keep rich people concentrated in the places they came from? Transferring money internationally is already a pain in the ass. You want to make it even harder? To outlaw bitcoin too? China itself is already restricting its people from taking money out of the country. It's nearly impossible for normal people to invest overseas because banks won't allow them to transfer their money.
  - tehlike 10y ago
    Thry can probably invest in housing through indirect ways. When the houses chinese bought do not result in increased housing, thats when things are wrong.
- angry_octet 10y ago
  Force them to invest in property trusts that build subsidised housing. Capped rental rates and penalties for non occupancy. Also allow other infrastructure bonds (rail, road, ports). It's the Zh retail investors who are screwing it up while baby boomers make windfall gains and the economy gets distorted.
deleted 10y ago
[deleted]
toodlebunions 10y ago
And it all poured into real estate.
mathattack 10y ago
Interesting about this on a per-capita basis. Is ~$2K per citizen a lot? I wonder what comparable #s for the US and Russia are. (Note that with 16,000-18,000 people doing the moving, it's very large per intermediary)
- neurostimulant 10y ago
  Average annual household income in China is around $10k, so yeah, $2k is quite a lot.
  - mathattack 10y ago
    The numbers are on a cumulative basis though. So $200 per person per year sounds less. It's hard to tell without seeing similar for other countries. I assume Russia is higher. And how do you measure corruption in government contracts in the US?
RandyRanderson 10y ago
BC is by far and away the most impacted region. Let's list some quick housing prices examples: NL - Amsterdam up 15% in 2016 [-1] AU - Sydney up 17% over 5 years [0] NZ - up 13% oct 2015-2016 [1] BC - Metro Vancouver up 31.4% August 2015-2016 alone. BC (not just vancouver) housing prices have almost tripled since 2004. [2] No, these new rules the BC government has put in place are not going to work. I've commented on the reasons before here: https://news.ycombinator.com/item?id=12873156 https://news.ycombinator.com/item?id=12873156 https://news.ycombinator.com/item?id=12215490 https://news.ycombinator.com/item?id=12215490 [-1] http://www.globalpropertyguide.com/Europe/Netherlands/Price-History http://www.globalpropertyguide.com/Europe/Netherlands/Price-... [0] https://en.wikipedia.org/wiki/Australian_property_bubble https://en.wikipedia.org/wiki/Australian_property_bubble [1] https://www.bloomberg.com/news/articles/2016-11-02/the-rich-have-found-a-place-to-escape-the-horrors-of-the-world https://www.bloomberg.com/news/articles/2016-11-02/the-rich-... [2] http://www.cbc.ca/news/canada/british-columbia/26-slump-in-vancouver-real-estate-sales-called-a-return-to-historically-normal-levels-1.3745825?kkk http://www.cbc.ca/news/canada/british-columbia/26-slump-in-v...
ForFreedom 10y ago
Might also explain a lot of Chinese moving into Australia.
sytelus 10y ago
Simple question: when some invests his corruption money in US, doesn't it automatically become "public" and hence traceable? For example, if you buy a house for X dollars in US then shouldn't Chinese government be able to easily trace you down? My understanding was that so called "black" money stays black only as long as you use it in form of cash, not investments.
- pjc50 10y ago
  Traceable to whom or what, though? If you've got enough money it's easy for the registered owner of the house to be e.g. a Cayman Islands company with anonymous directors.
- webmaven 10y ago
  > when some invests his corruption money in US, doesn't it automatically become "public" and hence traceable? Keep in mind that these RE investments are also a form of "rainy day" bolthole, ie. if you have to flee on short notice you land in SF, pick up the documents for the new identity you set up a few years ago, and move into one of the places you now own (none of which are traceable to your original identity). The fact that your new identity is now "on the books" is a feature, not a bug.
- angry_octet 10y ago
  No, money is frangible. The money might be sitting in a US bank account seemingly unspent, but the company may have incurred a 'debt' for which that sum is locked as a security for a loan another party had. Or the company may have rental or production expenses that siphon money to another entity. Any number of ways. Also, the US government wouldn't normally exchange taxation (transfer taxes) with the Chinese, so it wouldn't be public.
kspaans 10y ago
And in a similar vein: https://news.ycombinator.com/item?id=13314967 https://news.ycombinator.com/item?id=13314967

160 points by kspaans 10y ago

Interesting point on the Vancouver angle: Q: In Canada, where does the money end up and why? A: Vancouver is the preferred destination, by far, because of perceived more relaxed anti-money laundering on-boarding compliance and more importantly, easier access to better schools and lifestyle for children of Chinese foreign nationals.

JumpCrisscross 10y ago
What's the source of their Vancouver assertion?
- raquo 10y ago
  Don't know their source, but I can confirm that relevant Canadian laws are wide open for abuse due to both being toothless and because of near zero enforcement, at both federal and provincial (BC) levels. You can google how CRA actively avoided auditing foreign buyers "for fear of racism allegations" (yeah right) or how people bring hundreds of thousands of dollars in paper bills on themselves and their children, paying only $2.5K if caught (cheaper than Western Union!). Or the latest Vancouver 15% foreign investor tax designed to appease the population, but wholly ineffective because it relies on self reporting which no one ever checks and allows for other obvious loopholes. Much better proposals were ignored in favour of this purposely flawed one. It's amazingly fucked up, I'm surprised Canadians are taking it so willingly.
  - aianus 10y ago
    > It's amazingly fucked up, I'm surprised Canadians are taking it so willingly. Nothing surprising about it, ~69% of Canadian households (and a much higher percentage of voters!) are homeowners and directly benefit from this influx of capital.
    - raquo 10y ago
      That home ownership rate includes everyone who lives in a dwelling owned by their family, so it includes the youth who lives with their parents because they can't afford to move out. Besides, all the home owners I know are not happy about constantly increasing prices either. Many of them think it's unfair, many don't like the foreign inflation aspect, and even pragmatically speaking it's harder to jump to owning a bigger dwelling now. So I don't know why this is going on, but it's not because most people want higher housing prices.

TaylorSwift 10y ago

What's wrong with keeping the proceeds in China?

kspaans 10y ago
From the article: China also has something called “grey” income, which means income earned (or acquired off the books) in China that is not reported on income taxes and that is held by its richest families. If the money can be laundered by buying a house overseas, grey becomes green!
- eternalban 10y ago
  How is it "held"? I've seen reports of raids where they find houses stuffed full of cash, but how do you get $2T in cash to Canada? At some point this is getting converted to electronic funds and that is where the "laundering" is happening. As to why they are buying hard assets in Anglo-sphere, possibly because they are worried that the said Anglos may pull the plug on the fiat currency in a Great Reset at some point in the near future. I guess the silver lining here is that the Chinese corrupt set are bullish on the continuity of rule of law over here.
  - afterburner 10y ago
    HSBC is complicit in laundering the money. They have been fined to that effect, but I doubt it's curtailed their activities much. I'm sure many other banks do the same.
  - querulous 10y ago
    if you know the right people and can stomach hours and hours in the cheapest seats on transpacific flights you can make $2k a week flying between beijing and vancouver
  - webmaven 10y ago
    > how do you get $2T in cash to Canada? Shipping containers?

pizza 10y ago

Wonder how this correlates with the current growth of the US economy, and maybe more relevantly, how the top 1% seems to be increasing its wealth much faster than the rest.

jamhan 10y ago

In Australia we were supposed to have tranche 2 ("covering real estate agents, lawyers, accountants, car dealers and others") of the anti-money laundering regulations introduced over 10 years ago. As this article details, it is "comically" overdue: http://www.smh.com.au/business/banking-and-finance/slated-antimoney-laundering-legislation-is-comically-overdue-20150913-gjlb7j.html http://www.smh.com.au/business/banking-and-finance/slated-an... While political parties can wallow in the extra taxes garnered from sky-rocketing real-estate prices and sizable party donations they have no incentive to introduce this second tranche. For example, any party in power in New South Sales will keep its budget in the black simply from "stamp-duty" taxes collected on real-estate transactions. The Foreign Investment Review Board was and is a farce and that's how the government likes it.

a_bonobo 10y ago

This is a relatively big problem in Australia - there has been talk of a housing bubble in Australia for the last few years which in part has been propped up by Chinese grey money buying whole apartment buildings for investment, which drives up prices (they can just dictate prices) and keeps young locals out [1]. I cannot afford a house and I have a well-paying job. The government looks the other way since building is one of the last big job creators now that the mining boom is over. For example, there is a government body for foreign investment breaches (rules like you're not allowed to buy 'used' property if you don't have permanent residency, but I've personally talked to quite a few Chinese students whose parents did that for them) but it has never once initiated court action [2]. So everybody profits in the short term - Chinese corruption can move 'dead' money out of the country, Australian government gets to present itself as a job creator. Except young Australians, who have to rent and cannot rely on real estate property for their retirement. In the long term, the bubble is going to pop and then you have dead cities with empty high rises falling apart (but then again, people have been saying for at least 10 years that the bubble is going to pop any day now and it's still inflating) [1] Contains no numbers: http://www.smh.com.au/comment/grey-money-from-china-helps-blow-our-property-bubble-20140928-10n7a8.html http://www.smh.com.au/comment/grey-money-from-china-helps-bl... [2] http://www.abc.net.au/news/2014-11-27/foreign-buyer-rule-enforcement-needs-to-be-strengthened/5921518 http://www.abc.net.au/news/2014-11-27/foreign-buyer-rule-enf...

kspaans 10y ago
Except young Australians, who have to rent and cannot rely on real estate property for their retirement. This is orthogonal to the money laundering, but what's stopping the young people from investing for their retirement? Houses are not the only way to build savings.
- a_bonobo 10y ago
  That's true, the Australian system of superannuation is actually pretty great, your job pays a portion of your income into your super which gets invested for you, you have some choice as to where it gets invested (high risk vs. low risk etc.) However what I fear is that if the super isn't managed well, inflation hits, or you just don't build up a large enough investment the high rental prices in Australia will eat up the majority of your investment returns.

codersbrew 10y ago

Is there a way to get the number of properties bought via a foreign entity? I'm sure with 3-4 different LLCs to shift cash through it's near impossible to tell.

sudeepj 10y ago

In India, "grey income" is called "black money". It is a hot topic in India right now. Recent activities on this: Note ban (Nov 2016) => https://en.wikipedia.org/wiki/Indian_black_money#Ban_on_1000_currency_notes https://en.wikipedia.org/wiki/Indian_black_money#Ban_on_1000... Using analytics (today's news) => http://economictimes.indiatimes.com/news/economy/policy/i-t-department-scanning-data-pile-to-dig-out-unaccounted-income/articleshow/56282112.cms http://economictimes.indiatimes.com/news/economy/policy/i-t-...

LiweiZ 10y ago
We Chinese call it "black money", too. But it sounds too harsh and directly pointing to crime when talking, esp. publicly. So the color is changed to gray meaning color between clear and black so that no one "overreacts" (when "black money" is normal, everywhere possible and most people deal with it do not end up in jail or are not being investigated"). Just a way people accept the reality.
conanbatt 10y ago
There is a distinction between corruption money and tax evasion. Hence the usage of gray vs black.

peteretep 10y ago

Wonder why the British Isles isn't in there; unlikely to be EU stuff as NL is on there.

andrewvijay 10y ago

I thought around 500 times to buy myself a car on christmas and then I see this

non_repro_blue 10y ago

That's a big number, way too large for anyone to take personally in an emotional sense. But it's definitely big enough for a purge. Jailing, disappearances and more. This is a pretty large economic tide. Almost twice the size of California's economy, all at once. Ranking it The Fifth Largest Economy, worldwide, if it's worth thinking in those terms. Given that an approximate number of participating Chinese nationals have been enumerated, if they suddenly disappeared (and ~20,000 is certainly within the realm of possibility), what would a sudden halt of two trillion (legal or not) do to the rest of the world?

ac29 10y ago
>This is a pretty large economic tide. Almost twice the size of California's economy, all at once. Well, not all at once, that number (USD 1.5T, the 2T number is CAD) is cumulative from 1995-2013, per the article.
- non_repro_blue 10y ago
  You're right. I skimmed the numbers too fast.
tajen 10y ago
Can you rephrase the question? If a tide of $2T suddenly stops (but doesn't reverse), would the worldwide economy tank? Well, every change in flows can be seen as "a crisis", the question is where the money belongs in the first place. At worst, it has made the city of Vancouver (or rather the former landlords who exited by selling) richer for a while, and they will learn to come back to their previous richness levels. Which is still better than never having seen the tide of money at all.
angry_octet 10y ago
Remember, there are no Chinese 401k plans. There is no retirement plan except for what you save and your children provide. Hang on, you only have one child. And the stock market is just smoke and mirrors and you can't actually own land in China... This is just a trickle of the money that needs to be invested for retirement or a rainy day. Western economies were left totally flat-footed by this, a combination of greed and incompetence.

coygui 10y ago

I study at Vancouver UBC and rented a room in a house in the nearby area. I could tell that the Canadian government has started to investigate the corrupted $ because one day a government official came to "my house" and asked the information about the previous landowner. It seemed that he used the corrupted $ to buy the real estate and make more $

ChuckMcM 10y ago
I'll just say if you're using house sales in Vancouver or the Bay Area to launder your money you are really moving a lot of money around. I bought a house for cash in Las Vegas after the crash and the bank never once asked where I got the funds to do so. I'm pretty sure they were supposed to.
- djrogers 10y ago
  > I bought a house for cash in Las Vegas after the crash and the bank never once asked where I got the funds to do so. I'm pretty sure they were supposed to. Umm, no. It only. I, but that's frightening. You have a right to privacy in a private transaction like that. Where you will run in to a ton of questions is when you use a big chunk of money for a down payment on a mortgage. In that case the bank wants to make sure you didn't borrow the down payment and get in over your head.
  - pjc50 10y ago
    The US has no general right to privacy, and all large transactions are potentially notifiable to the anti-money-laundering authorities. This is what HSBC got in a lot of trouble for not doing.
    - djrogers 10y ago
      Any notification would go as far as that - simple notification of a transaction. There's no requirement for the bank to investigate the source of your funds as part of a private transaction.

ygmelnikova 10y ago

I own a house in Vancouver. Let's just hold off until I can sell it, then crack down on this blatant corruption.

tehlike 10y ago

I wonder what ways US could prevent Chinese money buying real estate in the US? 1. Do what Vancouver did, add tax for foreign property ownership. 2. Tighten the checks on origin of money? How exactly, especially when it's coming as all cash? Maybe forcing it to go through a bank, where more thorough check is mandatory per IRS? But then again, banks are not the most trustworthy in this country. 3. Other ideas?

Hondor 10y ago
Why ban Chinese money, not local money or money from other countries? What's your actual goal? To keep rich people concentrated in the places they came from? Transferring money internationally is already a pain in the ass. You want to make it even harder? To outlaw bitcoin too? China itself is already restricting its people from taking money out of the country. It's nearly impossible for normal people to invest overseas because banks won't allow them to transfer their money.
- tehlike 10y ago
  Thry can probably invest in housing through indirect ways. When the houses chinese bought do not result in increased housing, thats when things are wrong.
angry_octet 10y ago
Force them to invest in property trusts that build subsidised housing. Capped rental rates and penalties for non occupancy. Also allow other infrastructure bonds (rail, road, ports). It's the Zh retail investors who are screwing it up while baby boomers make windfall gains and the economy gets distorted.

deleted 10y ago

[deleted]

toodlebunions 10y ago

And it all poured into real estate.

mathattack 10y ago

Interesting about this on a per-capita basis. Is ~$2K per citizen a lot? I wonder what comparable #s for the US and Russia are. (Note that with 16,000-18,000 people doing the moving, it's very large per intermediary)

neurostimulant 10y ago
Average annual household income in China is around $10k, so yeah, $2k is quite a lot.
- mathattack 10y ago
  The numbers are on a cumulative basis though. So $200 per person per year sounds less. It's hard to tell without seeing similar for other countries. I assume Russia is higher. And how do you measure corruption in government contracts in the US?

RandyRanderson 10y ago

BC is by far and away the most impacted region. Let's list some quick housing prices examples: NL - Amsterdam up 15% in 2016 [-1] AU - Sydney up 17% over 5 years [0] NZ - up 13% oct 2015-2016 [1] BC - Metro Vancouver up 31.4% August 2015-2016 alone. BC (not just vancouver) housing prices have almost tripled since 2004. [2] No, these new rules the BC government has put in place are not going to work. I've commented on the reasons before here: https://news.ycombinator.com/item?id=12873156 https://news.ycombinator.com/item?id=12873156 https://news.ycombinator.com/item?id=12215490 https://news.ycombinator.com/item?id=12215490 [-1] http://www.globalpropertyguide.com/Europe/Netherlands/Price-History http://www.globalpropertyguide.com/Europe/Netherlands/Price-... [0] https://en.wikipedia.org/wiki/Australian_property_bubble https://en.wikipedia.org/wiki/Australian_property_bubble [1] https://www.bloomberg.com/news/articles/2016-11-02/the-rich-have-found-a-place-to-escape-the-horrors-of-the-world https://www.bloomberg.com/news/articles/2016-11-02/the-rich-... [2] http://www.cbc.ca/news/canada/british-columbia/26-slump-in-vancouver-real-estate-sales-called-a-return-to-historically-normal-levels-1.3745825?kkk http://www.cbc.ca/news/canada/british-columbia/26-slump-in-v...

ForFreedom 10y ago

Might also explain a lot of Chinese moving into Australia.

sytelus 10y ago

Simple question: when some invests his corruption money in US, doesn't it automatically become "public" and hence traceable? For example, if you buy a house for X dollars in US then shouldn't Chinese government be able to easily trace you down? My understanding was that so called "black" money stays black only as long as you use it in form of cash, not investments.

pjc50 10y ago
Traceable to whom or what, though? If you've got enough money it's easy for the registered owner of the house to be e.g. a Cayman Islands company with anonymous directors.
webmaven 10y ago
> when some invests his corruption money in US, doesn't it automatically become "public" and hence traceable? Keep in mind that these RE investments are also a form of "rainy day" bolthole, ie. if you have to flee on short notice you land in SF, pick up the documents for the new identity you set up a few years ago, and move into one of the places you now own (none of which are traceable to your original identity). The fact that your new identity is now "on the books" is a feature, not a bug.
angry_octet 10y ago
No, money is frangible. The money might be sitting in a US bank account seemingly unspent, but the company may have incurred a 'debt' for which that sum is locked as a security for a loan another party had. Or the company may have rental or production expenses that siphon money to another entity. Any number of ways. Also, the US government wouldn't normally exchange taxation (transfer taxes) with the Chinese, so it wouldn't be public.

kspaans 10y ago

And in a similar vein: https://news.ycombinator.com/item?id=13314967 https://news.ycombinator.com/item?id=13314967