Apart from investing in real estate abroad, last year, Chinese folks were buying huge amounts of bitcoins.
What is the reason, Chinese people trust their economy less than the western economy ?
China Estimates Largest Capital Outflow in More Than a Decade in 2014
21–30 of 39 posts
Re: China Estimates Largest Capital Outflow in More Than a Decade in 2014
#22I wish HN would ban paywalled article links.
I also think that would make sense. Paywalling is a legitimate business strategy amd I don't fault these companies for wanting to get paid for content creation. However, HN is an aggregator so many people can't view an article like this. If a paywall article is posted, it would be nice to have a link to a plain text version or alternate link. I think this would be a good compromise.
Re: China Estimates Largest Capital Outflow in More Than a Decade in 2014
#23Apart from investing in real estate abroad, last year, Chinese folks were buying huge amounts of bitcoins. What is the reason, Chinese people trust their economy less than the western economy ?
Evading capital controls, perhaps? Since the Yuan is not fully convertible, you can get USD from Yuan by using Bitcoin as an intermediary.
Re: China Estimates Largest Capital Outflow in More Than a Decade in 2014
#24"Mr. Tao informed the audience that the capital flight from China in December alone amounted to $20 billion, and that was just from official channels. The true amount could be four times greater." So this bureaucrat just committed career suicide by admitting this.
Not really, think again.
China needs to convert their $4T into "real value" sooner or later. Rather sooner. Various official statements over the last year indicated as much: "after decades of accumulating dollars and treasuries, we have concluded that it would be wiser to reverse course and start spending them".
This presents them with two problems, the danger of being accused of dumping dollars (aka of agressive currency warfare), and the risk that doing so too much, too fast could crash the value of their remaining holdings when "financial markets" see what you're up to.
Much better to let your 1.3 billion people do the job: seemingly-inadvertently "encourage" capital flight and replace any too many "capital outflows" with your reserves. Your folks buy up assets all over the world and officials have the excuse of an emergency situation that justifies "using our reserves that were always meant for a rainy day just like this".
Just a wild little theory of mine. Take it or leave it ;D
Re: China Estimates Largest Capital Outflow in More Than a Decade in 2014
#25This a problem in first tier cities even in the US. It's not only the IPO crowd driving up prices in SF, NYC, etc. But these foreign investors --the IPO people get the flack from displaced communities, but foreign investment contributes its own good share of this new housing shortage... It's begun to affect second tier cities like Minneapolis, Austin, etc.
Try living in a city like Miami where a staggering amount of condos/property are primarily treated as a store of value by foreigners.
Sorry, but I agree, this is being felt by all first tier cities, like Miami, as well as second tier metros.
Re: China Estimates Largest Capital Outflow in More Than a Decade in 2014
#26Apart from investing in real estate abroad, last year, Chinese folks were buying huge amounts of bitcoins. What is the reason, Chinese people trust their economy less than the western economy ?
Evading capital controls, perhaps? Since the Yuan is not fully convertible, you can get USD from Yuan by using Bitcoin as an intermediary.
Chinese capital controls are easing. The country has a lot of cash and continues to have a lot of income from exports. They're buying nice stuff and taking luxury vacations. They're investing in foreign companies and property. They can afford to, so why not? Were they supposed to just sit on the funds forever?
Re: China Estimates Largest Capital Outflow in More Than a Decade in 2014
#27Earlier quoted context omitted.
Australia and Canada are very similar. Both continued with a housing bubble well after all other Western markets collapsed. Both also supplied the raw materials that fuel China's economy; an economy that didn't slow down very much while the rest of the West suffered. But now they're clearly takings some of the heat out of their economy. Australia and Canada will feel that.
but just when will this bubble burst and are there any metrics or signs we can find that have suggested the bursting of subprime mortgage debts in 2008?
US subprime mortgage defaults were just the trigger for the 2008 global financial crisis. Most subsequent mortgage defaults in the US (and Ireland, Portugal, Spain etc.) were for prime mortgages.
My guess is that the Saudi oil price war, Chinese credit defaults and turmoil in the Eurozone will trigger an even bigger global financial in 2015.
FWIW I currently live in Melbourne, Australia, but lived in southern California when the US housing bubble burst. I see lots of parallels in Australia, but if anything the housing bubble in Australia is even bigger due to idiotic policies like negative gearing and interest only investor mortgages.
Re: China Estimates Largest Capital Outflow in More Than a Decade in 2014
#28I wish HN would ban paywalled article links.
I also think that would make sense. Paywalling is a legitimate business strategy amd I don't fault these companies for wanting to get paid for content creation. However, HN is an aggregator so many people can't view an article like this. If a paywall article is posted, it would be nice to have a link to a plain text version or alternate link. I think this would be a good compromise.
All you have to do is Google the title and click the link from there, and no paywall.
Re: China Estimates Largest Capital Outflow in More Than a Decade in 2014
#29Earlier quoted context omitted.
The typical vancouverite response (annoying) is "oh but our prices will never fall, we live on the best god damn city in the planet, just look at all this foreign demand for our real estate, we are in a bubble you say, you eggheads have been crying about it for the past 15 years and look it hasn't happened so it never will, this time it's different " "this time it's different" - japanese real estate bubble. "we are i…
And how's the weather where you are? I took my dog to the dog beach this morning. Sunny and 12* ABOVE. We had one day of snow this year. And the "wet coast" is really a myth. Seattle gets rain, but Vancouver is tucked behind Vancouver Island and is much drier. In all seriousness, the real estate market is driven by people with money, the investor class. They are older and do not necessarily work, or they work interna…
> And the "wet coast" is really a myth.
Nice try but Vancouver really is wet and miserable most days in winter. I know because I lived there for 5 years. Sure winter is more bearable than Halifax or St John's but that's not saying much.
Now I live in Melbourne and just laugh and point to the banana tree in my backyard when people complain about winter here.
Re: China Estimates Largest Capital Outflow in More Than a Decade in 2014
#30I wish HN would ban paywalled article links.
I also think that would make sense. Paywalling is a legitimate business strategy amd I don't fault these companies for wanting to get paid for content creation. However, HN is an aggregator so many people can't view an article like this. If a paywall article is posted, it would be nice to have a link to a plain text version or alternate link. I think this would be a good compromise.
Isn't your good compromise just US Copyright violation by another name?