Chinese Entrepreneurs Are Leaving China

[Ideologue]

What Mono said.

The authour of that article, BtW, is part of the semi-hysterical "China is about to collapse!" cottage industry of publications, which have predicated around 100,000 of the past 0 collapses in the Chinese system over the past 2 decades. He wrote a book about 10 years ago called The Coming Collapse of China.  So the tone of the article is not surprising.

But China will still collapse.

[Eddie Teach]

Sure. But it won't do the world much good if they take a couple centuries to do it.

[Admiral Yi]

This sounds like the sort of thing a sneaky crook can get away with once before retiring to a tropical island with his money, not standard practice. How is it standard practice?- don't the Chinese know 'Fool me once, shame on you. Fool me twice, shame on me'? Why do they keep investing?

Their investment options are not unlimited.

[Ideologue]

Sure. But it won't do the world much good if they take a couple centuries to do it.

This is the country that lost twenty million lives in a civil war against a guy who claimed to be Jesus' brother.

[Monoriu]

Sure. But it won't do the world much good if they take a couple centuries to do it.

This is the country that lost twenty million lives in a civil war against a guy who claimed to be Jesus' brother.

China did not collaspe after the Tai Ping rebellion

[Josquius]

Their investment options are not unlimited.

They've banks surely?
Or a sturdy box under their floorboards?

[grumbler]

Their investment options are not unlimited.

They've banks surely?
Or a sturdy box under their floorboards?

  Are those "investment opportunities" in your mind?

[The Minsky Moment]

This sounds like the sort of thing a sneaky crook can get away with once before retiring to a tropical island with his money, not standard practice. How is it standard practice?- don't the Chinese know 'Fool me once, shame on you. Fool me twice, shame on me'? Why do they keep investing?

Their investment options are not unlimited.

Correct.  What are the options for private savings?  Property is very volatile and provincial construction schemes have created a bubble market.  Stocks have similar problems - company assets and prospects vary depending on the results of bureaucratic infighting.  The corporate bond market is basically a shell game where state-controlled banks shuffle around liabilities.  The banks offer very poor returns on deposits.

The Chinese provincial bonds offer attractive yields and investors hope that if push comes to shove the State will back up the obligations.

[Malthus]

I'm not talking about a wholesale elimination of the right to own assets, I'm talking about arbitrary expropriation a la Putin's Russia.

Yeah, that's what I'd worry about as well were I in China. Most people keep their heads down and want to make money, but everyone's aware that things can go to hell. Most of the Chinese who are very rich are the same generation as my in-laws or older. They've all experienced the cultural revolution, so they have a pretty good idea of how horrible things can get. It only makes sense to have a back-up plan.

This - it is similar to people of my parent's generation and their feelings about Europe: they were traumatized by what had happened, and were very slow to accept that history took a sea-change after WW2 and the Nazis weren't comming back.

The change in China is of course much more recent - hell, I can remember the arrest of the Gang of Four in 1976! It is no wonder that many, whether justified or not, are still traumatized into paranoia. 

[viper37]

Heck, I have done it myself.

You did it to get a Canadian passport, not to work abroad.

[Josquius]

Their investment options are not unlimited.

They've banks surely?
Or a sturdy box under their floorboards?

  Are those "investment opportunities" in your mind?

Better to keep the amount of money you have or gain a little bit of interest on it than to lose it on scams.

[The Minsky Moment]

Better to keep the amount of money you have or gain a little bit of interest on it than to lose it on scams.

I'm not sure it is feasible to withdraw large amounts of yuan banknotes.

[Jacob]

This - it is similar to people of my parent's generation and their feelings about Europe: they were traumatized by what had happened, and were very slow to accept that history took a sea-change after WW2 and the Nazis weren't comming back.

The change in China is of course much more recent - hell, I can remember the arrest of the Gang of Four in 1976! It is no wonder that many, whether justified or not, are still traumatized into paranoia.

Yeah, especially given that there's been no real break with that past either. There's the mayor in Chongqin who's trying to get into the politburo through a campaign of cracking down on corruption and reviving Maoist rhetoric. Not to mention things like the crackdown in Tiananmen Square, the detention of Ai Wei Wei, the censorship and so on. It's not like the paranoia is entirely unjustified.

[Jacob]

Better to keep the amount of money you have or gain a little bit of interest on it than to lose it on scams.

I'm not sure it is feasible to withdraw large amounts of yuan banknotes.

Depends what you mean by a large number. Pulling out the equivalent of a couple of hundred grand US isn't that big a deal. Above that, I don't know, but I expect it's not that big a problem. Now if you're talking hundreds of millions of US dollars equivalent, then I have no idea but if you have that much money you probably have ways of getting things done.

[The Minsky Moment]

Depends what you mean by a large number. Pulling out the equivalent of a couple of hundred grand US isn't that big a deal. Above that, I don't know, but I expect it's not that big a problem. Now if you're talking hundreds of millions of US dollars equivalent, then I have no idea but if you have that much money you probably have ways of getting things done.

The article is talking about people with net worth in the millions of US dollars equivalent.  Sticking it in a box doesn't seem a viable option.  Anyone with the pull to be able to do this probably has access to enough inside info to have better options.