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Those is why China started limiting the outflow of capital several years ago. It has an immediate effect in LA, where a number of buildings under construction

Those is why China started limiting the outflow of capital several years ago. It has an immediate effect in LA, where a number of buildings under construction were financed by Chinese investors. In one case, the developer itself couldn't get it's own money out, and now they have a giant unfinished hulk right across from Staples Center.

tenpies 6y ago
> Those is why China started limiting the outflow of capital several years ago. On paper, but like all things in China enforcement is a completely different thing. There are many ways around it and it's much easier when Canada's AML and KYC requirements would make a 1980s' Caribbean Banker blush. Even a municipal vacancy tax is just a new cost of doing business. Further, the Canadian Liberals and BoC have both signalled that they intend to devalue the CAD and prop up real-estate. You'd be a fool as a Chinese foreign investor to not dump money into Canadian real estate. It's de-facto government-backed at this point, comes with a Canadian passport, and the Canadian Liberals will never move a finger against you or China.
- boringg 6y ago
  I don't think you've been reading news over the last year about Canada being considerably unhappy with China these days. I'd disagree with your characterizing the liberals at not doing anything. Also have you been paying attention to the meng wanzhou CTO of Huawei at all? I'm tempted to fact-check the rest of your statements as a function of the complete inaccuracy of the last one but that would take to much time :)
  - ChrisClark 6y ago
    He might be Albertan. I'm in Alberta and a lot of people here are in their own filtered news bubble. They state as fact that Trudeau is working for China directly, or 'worse', is somehow a secret Muslim... It's an alternate reality here, and very sad. :(
  - fakedang 6y ago
    I don't see how his arguments are highly specious or any less accurate. > On paper, but like all things in China enforcement is a completely different thing. There are many ways around it and it's much easier when Canada's AML and KYC requirements would make a 1980s' Caribbean Banker blush. Yes, if you have the right connections, which almost all these investors have, it's no biggie to move money out of China. I don't know about Canadian laws to make a comparison about Canadian laws to a Caribbean banker in the 80s. But I do know that the Chinese are plowing money everywhere - Malaysia, Thailand, parts of Europe, Singapore, almost all of them are being massively bought by Chinese investors. Does not take a genius to figure out that the CCP plan has either failed, or more likely was just political grandstanding for their Weibo and QQ fans. > Even a municipal vacancy tax is just a new cost of doing business. When you're a monied investor, taxes just become operating costs. I remember back in the day, my family in a Gulf country had to pay an exorbitant part of our income to get a "license fee" to set up a tiny restaurant no bigger than a Subway. Now, I just opened a satellite office for investors in one of the fanciest districts in the country and those license fees are just a cost of doing business. Not to mention, I'm getting a fuck ton of local subsidies to do that, driving my costs further. This is the case with almost all major cities in emerging markets I know of struggling to build an ecosystem (Singapore, KL, Dubai, Riyadh, etc). > Further, the Canadian Liberals and BoC have both signalled that they intend to devalue the CAD and prop up real-estate. You'd be a fool as a Chinese foreign investor to not dump money into Canadian real estate. It's de-facto government-backed at this point, comes with a Canadian passport, and the Canadian Liberals will never move a finger against you or China. I don't know if it's tied to the Liberals, but the CAD has seen significant devaluation against the dollar the past 5 years or 10 years (excluding the effects of USD appreciation too). I also do not know about Canadian govt incentives to boost real estate, but that's not far fetched to assume from #2. Current requirements for citiznship by investment (in Quebec, the federal programme was shut down) show a requirement of only CAD 2 million as net worth, not even direct investment, and an intention to settle in Quebec. Alternatively, one could set up a BS company and get a federal pass through. Both of which aren't hard for the typical Chinese investor to prove. So yes, the government programme does come with an easy passport at the end of it. Lastly, let's be honest - Canada only took on Meng Wanzhou because the US told them to. If they were really serious about Huawei breaching the Iran sanctions, they would have to arrest a number of other Chinese businessmen who own property in Canada, as well as a number of Arab and Iranian businessmen, who don't have qualms skirting the sanctions. Canada is only standing up to China at the moment, because they have US backing, and because it's Meng Wanzhou.
- gamblor956 6y ago
  On paper, but like all things in China enforcement is a completely different thing. There are many ways around it and it's much easier when Canada's AML and KYC requirements would make a 1980s' Caribbean Banker blush. China's been pretty heavy-handed in its enforcement of these rules. As noted earlier, they basically killed off Chinese cash buyers in the US market in California, and have done the same to Vancouver.

tenpies 6y ago

> Those is why China started limiting the outflow of capital several years ago. On paper, but like all things in China enforcement is a completely different thing. There are many ways around it and it's much easier when Canada's AML and KYC requirements would make a 1980s' Caribbean Banker blush. Even a municipal vacancy tax is just a new cost of doing business. Further, the Canadian Liberals and BoC have both signalled that they intend to devalue the CAD and prop up real-estate. You'd be a fool as a Chinese foreign investor to not dump money into Canadian real estate. It's de-facto government-backed at this point, comes with a Canadian passport, and the Canadian Liberals will never move a finger against you or China.

boringg 6y ago
I don't think you've been reading news over the last year about Canada being considerably unhappy with China these days. I'd disagree with your characterizing the liberals at not doing anything. Also have you been paying attention to the meng wanzhou CTO of Huawei at all? I'm tempted to fact-check the rest of your statements as a function of the complete inaccuracy of the last one but that would take to much time :)
- ChrisClark 6y ago
  He might be Albertan. I'm in Alberta and a lot of people here are in their own filtered news bubble. They state as fact that Trudeau is working for China directly, or 'worse', is somehow a secret Muslim... It's an alternate reality here, and very sad. :(
- fakedang 6y ago
  I don't see how his arguments are highly specious or any less accurate. > On paper, but like all things in China enforcement is a completely different thing. There are many ways around it and it's much easier when Canada's AML and KYC requirements would make a 1980s' Caribbean Banker blush. Yes, if you have the right connections, which almost all these investors have, it's no biggie to move money out of China. I don't know about Canadian laws to make a comparison about Canadian laws to a Caribbean banker in the 80s. But I do know that the Chinese are plowing money everywhere - Malaysia, Thailand, parts of Europe, Singapore, almost all of them are being massively bought by Chinese investors. Does not take a genius to figure out that the CCP plan has either failed, or more likely was just political grandstanding for their Weibo and QQ fans. > Even a municipal vacancy tax is just a new cost of doing business. When you're a monied investor, taxes just become operating costs. I remember back in the day, my family in a Gulf country had to pay an exorbitant part of our income to get a "license fee" to set up a tiny restaurant no bigger than a Subway. Now, I just opened a satellite office for investors in one of the fanciest districts in the country and those license fees are just a cost of doing business. Not to mention, I'm getting a fuck ton of local subsidies to do that, driving my costs further. This is the case with almost all major cities in emerging markets I know of struggling to build an ecosystem (Singapore, KL, Dubai, Riyadh, etc). > Further, the Canadian Liberals and BoC have both signalled that they intend to devalue the CAD and prop up real-estate. You'd be a fool as a Chinese foreign investor to not dump money into Canadian real estate. It's de-facto government-backed at this point, comes with a Canadian passport, and the Canadian Liberals will never move a finger against you or China. I don't know if it's tied to the Liberals, but the CAD has seen significant devaluation against the dollar the past 5 years or 10 years (excluding the effects of USD appreciation too). I also do not know about Canadian govt incentives to boost real estate, but that's not far fetched to assume from #2. Current requirements for citiznship by investment (in Quebec, the federal programme was shut down) show a requirement of only CAD 2 million as net worth, not even direct investment, and an intention to settle in Quebec. Alternatively, one could set up a BS company and get a federal pass through. Both of which aren't hard for the typical Chinese investor to prove. So yes, the government programme does come with an easy passport at the end of it. Lastly, let's be honest - Canada only took on Meng Wanzhou because the US told them to. If they were really serious about Huawei breaching the Iran sanctions, they would have to arrest a number of other Chinese businessmen who own property in Canada, as well as a number of Arab and Iranian businessmen, who don't have qualms skirting the sanctions. Canada is only standing up to China at the moment, because they have US backing, and because it's Meng Wanzhou.
gamblor956 6y ago
On paper, but like all things in China enforcement is a completely different thing. There are many ways around it and it's much easier when Canada's AML and KYC requirements would make a 1980s' Caribbean Banker blush. China's been pretty heavy-handed in its enforcement of these rules. As noted earlier, they basically killed off Chinese cash buyers in the US market in California, and have done the same to Vancouver.