Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

"Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

thebureau.news

Post reply on HN
Print view View original

171–180 of 417 posts

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#171

Post by cbsmith »

ilrwbwrkhv wrote: post #108

I have said this over and over again: Canada is the most overrated of all the developed countries. The whole country is a gigantic house of cards propped up by real estate, with horrible service quality, terrible healthcare, no jobs, ZERO innovation, risk taking and entrepreneurship. Having lived and travelled extensively, most Canadians want a house somewhere in the woods instead of doing something meaningful with t…

> The whole country is a gigantic house of cards propped up by real estate, with horrible service quality, terrible healthcare, no jobs, ZERO innovation, risk taking and entrepreneurship.

Canada has generally had a more conservative financial industry, which is a large part of why they were able to escape the 2008 mortgage crisis, and that, in turn, has lead to a stronger real estate market. Additionally, the recent post COVID-19 influx of immigrants has driven up demand for housing like crazy. There's not a lot of question that the real estate market is hot. But...

...I'd point out that considering it's population, Canada has had an impressive number of innovative companies just in the tech sector over the years. Alias & Softimage in 3D rendering. Shopify in e-commerce. Research in Motion in mobile phones. Ecobee in the smart homes/IOT space. Certicom in cryptography. Going farther back, Corel was a software giant. There's relative newcomers to with Hopper, Imagia, etc. I don't think it's fair to say there's no innovation, risk taking, or entrepreneurship.

> All of this is propped up by rampant levels of immigration from China and India. Where US got the best talent from India, Canada got the worst, the ones who scam their way here and take the lowest level jobs.

I'm not sure where you get that from. Canada's immigration policies have historically been more oriented towards merit/highly skilled immigrants than the US.

> Now all of this is coming home to roost. The next decade will be Canada's worst and if they do not learn that risk taking and entrepreneurship is the only way out of the mess they find themselves in, they will become a third world country in another decade.

I'm not sure what is fueling your perspective, but there is a lot of concern about Canada's economic policy coming out of COVID-19, in particular, the big deficits and explosive immigration are putting a strain on the economy. However, there's a very credible possibility that these will prove to be effective "investments" that pay off in the long run. Ironically, given your criticisms, Canada is taking on a lot of risk!

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#172

Post by alchemist1e9 »

denton-scratch wrote: post #112
alchemist1e9 wrote: post #49

Earlier quoted context omitted.

This proposal is a slippery slope to economic disaster. First, restricting ownership rights—foreign or domestic—distorts the market, disincentivizes investment, and ultimately harms those it claims to help by reducing the supply of housing. Second, treating homes purely as shelter ignores the reality that property is also an investment and a key component of individual wealth and economic freedom. Imposing heavy taxe…

> treating homes purely as shelter ignores the reality that property is also an investment But that's the problem, isn't it? The basic necessities of life shouldn't become a vehicle for speculation. FTR, all of my wealth is in two homes.

Asserting that housing—or any basic necessity—shouldn’t be an investment is a dangerously naive stance that flies in the face of economic reality and human history. Consider food, water, healthcare—all necessities, yet all benefit from private investment and innovation. The collectivist dream to strip away the investment aspect of housing is a recipe for disaster, leading to shortages, degradation, and inefficiency. Your stance isn’t just misguided; it’s empirically proven to fail, fostering misery under the guise of equality. Housing, like any resource, flourishes under conditions of freedom, not under the heavy hand of state control. To suggest otherwise is to ignore the lessons of history and to jeopardize the very foundations of prosperity and freedom.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#173

Post by JumpCrisscross »

SunlightEdge wrote: post #100

To maybe offer a different perspective: I think the Canadian mortgages linked to Chinese accounts will likely all be paid. What may be happening is that there is a lot of underground chinese financial activity that is not recorded in Canada and part of this 'network' is utilized to get money out of china.

> think the Canadian mortgages linked to Chinese accounts will likely all be paid

Out of curiosity, why? China's stock market is melting down in the midst of persistent deflation. A lot of people who thought they had liquidity may not anymore. Beijing could open the taps, but then that puts pressure on the currency.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#174

Post by [deleted] »

jabbany wrote: post #168
topspin wrote: post #156

Earlier quoted context omitted.

> if both the lender and borrower are willing participants Eventually this behavior goes overboard and everything crashes. In the meantime, law-abiding people are screwed by the bubble. Then they are made to pay for the clean up. Fraud is costly, and rationalizing it contributes to the problem.

> this behavior goes overboard and everything crashes Maybe... but you need to keep in mind most of these people are not really building a bubble. Unlike the subprime mortgage crisis, where things were built on inflated valuations, many borrowers in this "scheme" do have more than enough funds to cover the entire mortgage. It's just that their capital is relatively illiquid. This is also why the high interest rates h…

[deleted]

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#175

Post by JumpCrisscross »

jabbany wrote: post #106
silent_cal wrote: post #103

Earlier quoted context omitted.

It's still fraud

You can label it however you want, if both the lender and borrower are willing participants, it will be difficult to prevent this from happening. Like mentioned in the article, often times the material is very obviously suspicious and banks probably know this and still turn a blind eye to it because these borrowers are low risk and much less sensitive to the high/rising interest rates of today...

> You can label it however you want, if both the lender and borrower are willing participants, it will be difficult to prevent this from happening

These aren't purely private transactions. If HSBC Canada fails, Ottawa is on the hook. The defrauded party here is the public. (And possibly the bank's lenders and shareholders.)

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#177

Post by jabbany »

seanmcdirmid wrote: post #134
maxglute wrote: post #102

Earlier quoted context omitted.

Not on Canada's end, it's a bunch of people using legal capital controls to get money into Canada. On PRC end, it's evading capital controls, which depending on your geopolitical alignment, can be illegal activity. But if you're in the west, you want that Chinese money. Free money from competitotrs as good as brain drain from competitors.

Capital controls have bad intentions anyways, I have no qualm with PRC citizens trying to avoid them. Not everyone in the west wants or likes Chinese money. It does lead to them basically exporting their bubble abroad, but Japan did the same in the 80s before their big bust.

Yup. Hence the capital control (less money leaking out means an easier recovery after the bust).

Of course, as is rational in capitalism, this just makes it even more urgent to skirt the capital control, lest you be caught with the burden of the bust. This was also why crypto was even an option for doing this, for a short while at least.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#178

Post by cbsmith »

radicaldreamer wrote: post #128
ThisIsMyAltAcct wrote: post #25

> The whistleblower, whom The Bureau is calling D.M., immigrated to Canada as an international student from India, making him a minority among mostly Chinese-Canadian co-workers at the Aurora branch. > “I am going to reveal potential mortgage fraud at HSBC Bank Canada and possibly some employees benefited from the fraud, financially pocketing thousands of dollars, which I call the proceeds of crime.” > FINTRAC’s stud…

Are US banks just a lot more strict about source of income than Canadian banks?

Short answer: no.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#179

Post by calf »

ilrwbwrkhv wrote: post #108

I have said this over and over again: Canada is the most overrated of all the developed countries. The whole country is a gigantic house of cards propped up by real estate, with horrible service quality, terrible healthcare, no jobs, ZERO innovation, risk taking and entrepreneurship. Having lived and travelled extensively, most Canadians want a house somewhere in the woods instead of doing something meaningful with t…

Canada is the way it is because it is next to the U.S. The Canadian brain drain was never entirely the fault of Canada; the gravitational pull of U.S. neoliberal capitalism (what you uncritically and a-historically call 'risk taking') is a nontrivial factor. Canadian protectionism would not go over well with its world power neighbour, which seeks to exploit intellectual and social capital.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#180

Post by gspetr »

JumpCrisscross wrote: post #160
ilrwbwrkhv wrote: post #108

I have said this over and over again: Canada is the most overrated of all the developed countries. The whole country is a gigantic house of cards propped up by real estate, with horrible service quality, terrible healthcare, no jobs, ZERO innovation, risk taking and entrepreneurship. Having lived and travelled extensively, most Canadians want a house somewhere in the woods instead of doing something meaningful with t…

> Canada is the most overrated of all the developed countries You're also a politically stable energy and resource exporter bang next to a global economic superpower and security guarantor. Oh, and access to two oceans and soon a third. Canada has plenty of problems. But it's also tremendously blessed.

What's funny is that if we substitute Canada with Russia in your comment, every word of it still holds true.

I suppose "stable" and "stagnant" are two sides of the same coin.

Post reply on HN