Comment by sasas | Hacker News Reader

Comment by sasas | Hacker News Reader

So is this one mechanism of how Chinese nations get their money out to afford million dollar properties in Australia?

> Australia's money laundering watchdog investigated more than $3 billion in suspicious transfers by Chinese investors last year, including $1 billion in property transactions. [1]

Considering they can only take out 50k USD per year [2]

I'm sure many can agree it's disgraceful that the Australian government is turning a blind eye to an incredible amount of money laundering... which some may argue is contributing to the incredibly high housing prices in Melbourne and Sydney. There are no median house prices left in Sydney under half a million dollars. [3].

A friend witnessed a Chinese national at an auction try to pay their deposit with a suitcase of cash. The real estate agent had to explain (through a translator) that they can't accept that amount of cash in a suitcase. Sorry can't give a reference here, but other HN'ers who have witnessed the auction frenzy in Australia may attest that this scenario is plausible.

Note, I'm not implying the Chinese are the direct contributor to the current situation, I am simply suggesting there is contributory related forces at play...

Australian Financial Review - "Of China's $47.3 billion (investments in Australia in 2016), $31.9 billion will go into real estate mostly in residential development assets." [4]

[1] http://www.news.com.au/finance/economy/australian-economy/ch...

[2] http://www.cityweekend.com.cn/china/article/how-to-get-your-...

[3] https://www.domain.com.au/news/there-are-now-no-suburbs-left...

[4] http://www.afr.com/real-estate/chinese-investment-in-real-es...

I feel like you may have a bit of an axe to grind about local real estate prices. Yes, they are money laundering in the sense that they are avoiding regulations from their home country. But they aren't trying to avoid Australian regulations right? These investors generally have legal businesses in China, as much as that is possible in a state like that.

"I'm sure many can agree it's disgraceful" is a particularly choice piece of rhetoric that I am still trying to unpack. Also I like how you over attributed your comment as an appeal to authority.

There is a whole ball of string that you find when you start pulling the thread of your argument. That ball of string can be called globalization. Many people around the world are just coming to terms with the trade offs involved in the the way we have structured the world today. You can see some of this in the nationalism of Trump and Brexit. It is a complicated problem with complicated answers. I just want people to watch out for situations like this and not think that "whoah, this is clearly disgracefully wrong".

> I feel like you may have a bit of an axe to grind about local real estate prices

Absolutely. Due primarily to record low interest rates, negative gearing and capital gains tax reductions.

> "I'm sure many can agree it's disgraceful" is a particularly choice piece of rhetoric that I am still trying to unpack

Thanks for pulling me up on that, I acknowledge the comment does not contribute to a healthy discussion.

> You can see some of this in the nationalism of Trump and Brexit.

Your spot on. As the gap widens people will be looking for others to blame for their misfortune. This is what we need to avoid at all costs. Nationalism has no place in society. I hope I did not come across as blaming a specific nationality. The blame goes directly onto government policy. Let's ensure Australia doesn't regress into the rhetoric we are seeing in other places.

> I just want people to watch out for situations like this and not think that "whoah, this is clearly disgracefully wrong".

Let me be very specific, what i'm implying is disgraceful is real estate agents and government regulatory bodies ignoring the "The Anti-Money Laundering and Counter-Terrorism Financing Act 2006" [1].

"AUSTRAC has identified that laundering illicit funds through real estate is an established money laundering method in Australia," said a spokesperson. "Criminals are drawn to real estate investment in Australia because it is possible to purchase in cash, it offers reliable returns and it is possible to disguise ownership." [2]

Example - "A senior Chinese policeman has been jailed for 17 years for embezzling money to buy two Australian homes for his two daughters." [3]

[1] http://www.austrac.gov.au/businesses/legislation/amlctf-act

[2] http://www.smh.com.au/business/the-neverending-money-launder...

[3] http://www.smh.com.au/world/chinese-police-chief-wang-jun-re...

Completely agree. As someone who lives in a developing country, it always seems funny to me how there is frequently a distorted view in developed countries of how globalization should work, where they get all the upsides but none of the competition.

Everybody loves the idea of selling in a global market, but few realize that with globalization there are more opportunities, but also that they will have to work harder, study more and be more creative to compete for businesses, jobs and assets, with billions of people who previously had little to no opportunities, but who are willing to put in a lot of effort to compete for a share of the global marketplace. The trickiest part is that with technology and education, globalization is inevitable in the long term, no matter what politicians do or think.

From my view, sometimes it looks hypocritical when people from developed countries criticize the local 1% and the rigged system and unfair privilege that keep rich people rich, but then demand and expect that they get those same advantages on a country wide level, without realizing that they are simply defending the global 1% because it benefits/affects them directly.

In this context, the objection is to laundering.

Within a developed and healthy economy, corruption is ideally minimised and caught by regulation.

Poorer developing countries are more prone to corruption and fraud, because there are not as many pooled resources to stop it.

The grandparent post is pretty clearly taking umbrage with those people attempting to circumvent the few systems in place. A motivation for doing that, is because a shifting their resources to a stable and developed economy legitimises their assets.

Those assets are often the result of raping their own country. People literally die, as money is stolen and taken from them.

This has nothing to do with accepting competition as a result of globalisation. It is however correlated with it, as open borders and trade makes it possible.

In a lot of ways, it mimics 19th century imperialism, where small countries were raped for their assets by foreign powers. The key difference being that, in these cases, the abuse and exploitation comes from within

Global globalization may be inevitable, but I don't really see why individual countries must accept it entirely. Why can't you pick and choose which parts to engage in, knowingly accepting the positive or negative consequences that come with that? I see very little reason why large advanced countries like the US can't decide to restrict some free trade and take the 10% or whatever hit to GDP, in exchange for greater control and less uncertainty. This may be a naive belief, but specifically why?

What I would see as problematic is that picking and choosing parts of globalization would probably involve limiting the development of technology, commerce, and in some cases limiting free speech. And depending on the restrictions put in place to limit it, it could end up becoming sort of a global discrimination program which leads up to social conflict or even a war. There is also a conflicting part in your statement, where if for example the US took a 10% hit in GDP, it would in real terms mean that unemployment would double or triple, education, health and the base of society in general would take a huge hit, besides loosing global military and economic leadership, probably leading to huge political instability which lead to less control and more uncertainty (which could give space for a dictatorship, an internal war or a slew of other social problems). Economic growth is sort of like a drug, because once you have a society hooked up and dependent on it, if you take it away cold turkey, everything else that society has built will come crashing.

Well, if just one simple action such as one country even partially opting out of globalization could lead to a world war, then I'd prefer to cancel the whole undertaking asap. Countries and civilizations have existed largely independently for centuries, if we've build ourselves a house of cards that can come down that easily, getting self sufficient and extracting yourself seems like pretty simple common sense.

> A friend witnessed a Chinese national at an auction try to pay their deposit with a suitcase of cash. The real estate agent had to explain (through a translator) that they can't accept that amount of cash in a suitcase.

In Vancouver there's a well oiled mechanism of bringing duffle bags of cash into casinos for cleansing, in plain sight and with the knowledge of law enforcement. There was a small scandal recently where police got involved for some reason, but nothing will come of it. Truth is stranger than fiction.

>In Vancouver there's a well oiled mechanism of bringing duffle bags of cash into casinos for cleansing, in plain sight and with the knowledge of law enforcement. There was a small scandal recently where police got involved for some reason, but nothing will come of it.

That's a very interesting fact, do you have a source so I can read more about it?

On mobile so can't easily find something, but if you're genuinely curious to know more, you can easily Google a significant newspaper article on it.

Yes, I could, but you're the one making a claim.

I'm not here to win internet points, believe whatever you want. It is a fact that money is being laundered.

I'm starting to think that the internet is starting to have significant effects on culture, in that people will no longer believe things that they see in physical reality if they can't find it reported on the internet.

>I'm not here to win internet points, believe whatever you want. It is a fact that money is being laundered.

If you can't document it, it's not a fact.

>I'm starting to think that the internet is starting to have significant effects on culture, in that people will no longer believe things that they see in physical reality if they can't find it reported on the internet.

If the claims you make are as pervasively known as you claim, it would be simple to provide a source.

I'm starting to think that the internet is starting to have significant effects on our culture, in that people think it's your opponent's job to discredit whatever claim you throw out into the ether rather than your job to prove it is accurate.

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