4 ms·

In many cases the owners do not view it as an investment, it's a store of wealth that is difficult for the government of their home country to seize. Hence even

by kitcar 8y ago

In many cases the owners do not view it as an investment, it's a store of wealth that is difficult for the government of their home country to seize. Hence even if they lose money every year it's better then the alternative -

adventured 8y ago
There's no value for the Chinese Government in seizing foreign personal homes of that sort. It's tens of billions of dollars, a trivial sum to them right now. They do not need that money. They need to strictly contain domestic capital from pouring overseas, which has largely been accomplished. And they need controls in place to restrict people from being able to easily flee, which they've also largely accomplished (social scores, heavy tracking, etc). For the most part it doesn't matter if you have a house in Vancouver if they can change a score and prevent you from ever flying away. If you have the audacity to try it anyway, they've probably got your family. Which is something they've used on many occasions to induce Chinese nationals to return.
- toomuchtodo 8y ago
  You might be misunderstanding the use case. The Chinese with wealth moved their wealth out of China to real estate in London, Canada, and parts of the US specifically to put it out of reach of the Chinese government and to avoid the capital outflow controls you refer to. Once safely outside of the PRC's reach, it's trivial to move the wealth around using corporate entity ownership (among other methods).
  - adventured 8y ago
    I don't misunderstand. I said that even if they've managed to get their capital outside of China, it doesn't matter. If they flee, China still can induce their return. It's not trivial to move capital around using foreign corporate entities, when they track all of your communication within China. If they even so much as get a hint of that going on, and it bothers them in the least, they can do anything they like to you at that point. The hint of suspicion is more than enough, if it suits them. Being able to move capital around is meaningless, if you're not entirely physically free yourself as well. Your scenario is only a sure thing, if you've escaped your capital and everyone you care about.
    - deleted 8y ago
      [deleted]
    - derefr 8y ago
      You’re assuming that the person trying to expropriate wealth cares about being able to spend it themselves, rather than e.g. their family who already lives in Canada being able to spend it while they sit in jail. Think in terms of nobility: what’s more important, your head or your dynasty?
      - flycaliguy 8y ago
        I went to university with the kids. Buying a family into a western education is part of the process and part of the investment beyond the capitol.
      - seanmcdirmid 8y ago
        China has tried to fight against this by banning naked officials (whose families are abroad). There are still way too many exceptions, of course, as this is a pretty unworkable rule. It also doesn't apply to private business people on the other side of the corruption equation.

by kitcar 8y ago

adventured 8y ago

There's no value for the Chinese Government in seizing foreign personal homes of that sort. It's tens of billions of dollars, a trivial sum to them right now. They do not need that money. They need to strictly contain domestic capital from pouring overseas, which has largely been accomplished. And they need controls in place to restrict people from being able to easily flee, which they've also largely accomplished (social scores, heavy tracking, etc). For the most part it doesn't matter if you have a house in Vancouver if they can change a score and prevent you from ever flying away. If you have the audacity to try it anyway, they've probably got your family. Which is something they've used on many occasions to induce Chinese nationals to return.

toomuchtodo 8y ago
You might be misunderstanding the use case. The Chinese with wealth moved their wealth out of China to real estate in London, Canada, and parts of the US specifically to put it out of reach of the Chinese government and to avoid the capital outflow controls you refer to. Once safely outside of the PRC's reach, it's trivial to move the wealth around using corporate entity ownership (among other methods).
- adventured 8y ago
  I don't misunderstand. I said that even if they've managed to get their capital outside of China, it doesn't matter. If they flee, China still can induce their return. It's not trivial to move capital around using foreign corporate entities, when they track all of your communication within China. If they even so much as get a hint of that going on, and it bothers them in the least, they can do anything they like to you at that point. The hint of suspicion is more than enough, if it suits them. Being able to move capital around is meaningless, if you're not entirely physically free yourself as well. Your scenario is only a sure thing, if you've escaped your capital and everyone you care about.
  - deleted 8y ago
    [deleted]
  - derefr 8y ago
    You’re assuming that the person trying to expropriate wealth cares about being able to spend it themselves, rather than e.g. their family who already lives in Canada being able to spend it while they sit in jail. Think in terms of nobility: what’s more important, your head or your dynasty?
    - flycaliguy 8y ago
      I went to university with the kids. Buying a family into a western education is part of the process and part of the investment beyond the capitol.
    - seanmcdirmid 8y ago
      China has tried to fight against this by banning naked officials (whose families are abroad). There are still way too many exceptions, of course, as this is a pretty unworkable rule. It also doesn't apply to private business people on the other side of the corruption equation.