Earlier quoted context omitted.
China mines 50% of all bitcoins
I wonder how many tonns of coal they burned
Because that is what you would care of if you try to bring your wealth offshore.
Chinese banks cause alarm as capital flight measures intensify
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Re: Chinese banks cause alarm as capital flight measures intensify
#42Capital flight will decrease (in the medium term, like by the end of the decade) as US Dollar dominance diminishes. Oil trades between China-Russia-India are now denominated in Rupee-Rubles or Renminbi-Rubles starting only this past year, and so the groundwork is already laid.
Maybe. But that’s not how it has worked in the past. In other cases capital controls like this cause international businesses to not trade in the currency and to instead demand other currencies to settle accounts, causing more capital flight.
There is an example in the article of an investor with money stuck in China. They won’t be doing as much investment as they would if the currency was liberal for instance.
The western currencies dominate foreign trade for lots of reasons, but the biggest by far is that they are easy to move.
Re: Chinese banks cause alarm as capital flight measures intensify
#43Capital flight will decrease (in the medium term, like by the end of the decade) as US Dollar dominance diminishes. Oil trades between China-Russia-India are now denominated in Rupee-Rubles or Renminbi-Rubles starting only this past year, and so the groundwork is already laid.
Re: Chinese banks cause alarm as capital flight measures intensify
#44I wonder what the billionaires do to get their money out? Do they pay people to travel with jewellery that gets sold for foreign currency once it's outside China? Do they overpay for imported goods and get the difference paid into a Swiss bank account? It's always interesting to me how really wealthy people pay for loopholes
They send their children overseas to overpriced universities, and are allowed to justify buying luxury cars, and other school related expenses. I don’t think the mentality on these expenses is getting a 1:1 conversion rate, but that money is meant to be spent. There’s various ways they can fund their children’s business ventures (passion projects) overseas without expecting it to ever turn a profit. With the nepotism…
> They send their children overseas to overpriced universities, and are allowed to justify buying luxury cars, and other school related expenses.
And real estate.
Re: Chinese banks cause alarm as capital flight measures intensify
#45I wonder what the billionaires do to get their money out? Do they pay people to travel with jewellery that gets sold for foreign currency once it's outside China? Do they overpay for imported goods and get the difference paid into a Swiss bank account? It's always interesting to me how really wealthy people pay for loopholes
https://www.cbc.ca/books/wilful-blindness-1.6136088
Organized Crime in places like Vancouver smuggles drugs into Canada, the funds are laundered in casinos and real estate, and the money is transferred from the Wealthy in China to OC in China, and the wealthy investor gets clean cash and houses in Canada.
Re: Chinese banks cause alarm as capital flight measures intensify
#46Are the increasingly tight capital controls a precursor to a war with Taiwan or because the CCP expects some other shock to occur? Is their economy expected to crash for some other reason or is this simply dictatorships love centralised control over everything especially capital?
Could be all of the above, but for at least a year I have been reading how the real estate bubble that's underpinning the Chinese growth economy is starting to pop with the potential to bleed into the banking system, e.g. [0]
If this happens, and is at bad as some analysts say it could be, then the model propping up the CCP effectively ends [1] and they'll have bigger things to worry about than re-unification or tariffs.
0. https://moderndiplomacy.eu/2022/07/17/a-real-estate-and-bank...
1. https://zeihan.com/the-cutting-room-files-part-6-the-future-...
Re: Chinese banks cause alarm as capital flight measures intensify
#47I wonder what the billionaires do to get their money out? Do they pay people to travel with jewellery that gets sold for foreign currency once it's outside China? Do they overpay for imported goods and get the difference paid into a Swiss bank account? It's always interesting to me how really wealthy people pay for loopholes
Buy crypto in China, sell it abroad. At least that was one approach. Note if you do it fairly quickly it doesn't matter what the value of the crypto is, just the liquidity. Another way is 'business' investments in other SE Asian countries, that then get liquidated and moved further abroad. China does a lot of business with S. Korea for example. If you have an export company, and China exports a lot, you can hold a po…
Or just buy/hold/sell a stable coin like BUSD, USDC, or USDT to minimize your market risk.
Please no comments on how “Tether is a scam”, blah blah blah.
Re: Chinese banks cause alarm as capital flight measures intensify
#48Earlier quoted context omitted.
Buy crypto in China, sell it abroad. At least that was one approach. Note if you do it fairly quickly it doesn't matter what the value of the crypto is, just the liquidity. Another way is 'business' investments in other SE Asian countries, that then get liquidated and moved further abroad. China does a lot of business with S. Korea for example. If you have an export company, and China exports a lot, you can hold a po…
Or just buy/hold/sell a stable coin like BUSD, USDC, or USDT to minimize your market risk. Please no comments on how “Tether is a scam”, blah blah blah.
If you're only interested in money laundering USDT is not a bad choice even if it is a scam.
Re: Chinese banks cause alarm as capital flight measures intensify
#49Earlier quoted context omitted.
Could be in preparation for supplying arms to Russia.
That possibility makes me really nervous. A few weeks ago I was pretty sure that Beijing would not be that stupid, and simply stick with sending tons of dual-use goods, to keep up the plausible deniability. But Chinese rockets hitting Ukrainian kids in Kyiv/Europe? That would trigger dramatic sanctions. I don't think that is priced into the current world stock market.
It's not stupid. It's bold and almost risk-free. The US aren't the only people allowed to do proxy wars.
Re: Chinese banks cause alarm as capital flight measures intensify
#50Earlier quoted context omitted.
That possibility makes me really nervous. A few weeks ago I was pretty sure that Beijing would not be that stupid, and simply stick with sending tons of dual-use goods, to keep up the plausible deniability. But Chinese rockets hitting Ukrainian kids in Kyiv/Europe? That would trigger dramatic sanctions. I don't think that is priced into the current world stock market.
It's not stupid. It's bold and almost risk-free. The US aren't the only people allowed to do proxy wars.
> almost risk-free
Wouldn’t the article indicate otherwise?