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Comment by TaylorSwift | Hacker News Reader

What's wrong with keeping the proceeds in China?

It needs to be invested. Chinese cultural attitudes around investing tend to favour real estate. Chinese real estate is too risky given the communist government's propensity for eminent domain and the possibility that they would confiscate it on the basis of corruption. That leaves foreign real estate in countries perceived to have sound government, rule of law and low barriers to entry for foreign investors.

Same problem with keeping money in Russia--political and financial capital are one and the same. Consider Khodorkovsky [1].

[1] https://en.m.wikipedia.org/wiki/Mikhail_Khodorkovsky

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!

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.

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.

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

> how do you get $2T in cash to Canada?

Shipping containers?

Try wire transfers.

Eg Their factory needed a container full of Danish ball bearings. They paid the overseas supplier. Maybe there was an actual container (in which case it was re-sold overseas) and maybe there wasn't. May e an actual container of bearings arrived in China.

Holding the proceeds of theft from a government in the government's currency is like lending the loot from a mugging back to the victim. The PRC can't freeze funds held in US dollars.

Rule by law.

Reasons for moving money and children abroad: diversification of investments, security, prestige, less pollution, schools.

Source: dated wealthy Chinese women.

In many parts of China it's effectively impossible to actually purchase residential real estate. Buyers actually only get a 70-year lease (could vary up or down) which is pointless if you want to preserve wealth for your descendants.

Developed countries are a safer investment. And the standard of living is higher.

The Chinese government/people might want it back.

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