China's overseas investments

As discussed in The Rule of Equity, China is a major international investor. Here's a fantastic graphic showing how much China has invested where, by industry:

http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/06/20150617_china.jpg

The Coming Deluge

 

As forecast in my novel, The Rule of Equity, the United States is facing a deluge of foreign investment. China has $4 trillion in foreign exchange reserves. The thousands of millionaires in China have tremendous incentive to acquire foreign assets.

I know several people who have been involved with the EB-5 visa program (U.S. visas issued to foreigners who invest more than $500,000 in America). About 85% of these visas are issued to Chinese investors. Chinese investors are buying up residential real estate throughout the U.S., especially along the west coast but also in other areas, as I've discussed before.

This article discusses one aspect of the issue--how Chinese investors need American assistance to wisely invest $2 trillion here in the next decade!

http://fortune.com/2014/10/28/us-china-foreign-investment/

Excerpt: "The recent $1.95 billion acquisition of the iconic Waldorf Astoria Hotel in New York by a private Chinese insurance company, Anbang, grabbed news headlines around the U.S. What attracted attention was not just the price paid by the Chinese investor ($1.95 billion was the highest price paid for an existing hotel in the U.S.), but the identity of the purchaser, China’s eighth-largest insurance conglomerate, owned by the grandson-in-law of the late Chinese leader Deng Xiaoping.

As with other high-profile Chinese deals (such as Shuanhui’s acquisition of Smithfield Foods for $4.7 billion in May 2013), the Waldorf Astoria transaction raises important business and policy questions: what is driving Chinese foreign direct investment (FDI) and what is the best response to this important development?"

Federal government subsidizes billionaires buying land

The Fed is not only enriching the elite by boosting the stock market, but its low interest rates are helping billionaires buy up huge ranches from struggling farmers and ranchers.
Excerpt: "A boom in the oil and gas industry and current 2% interest rates on ranch mortgages are also fueling big land grabs."

Yet another example of how wealth and income inequality is being entrenched for future generations.

Excerpt: "Michael Hewatt, a member of the D.R. Horton board, says the company will use it much like it does the two large ranches it owns in Texas: as a place to entertain brokers, bankers and other D.R. Horton vendors. “It’s a perk for the people we work with,” he says. He also says the ranch is a “good investment for the long term.” Mr. Horton has also personally purchased large parcels of ranch land in Texas and New Mexico, according to public records."



http://online.wsj.com/articles/billionaire-businessmen-buying-up-mega-ranches-1414076608

More fun: "A major ranch purchase also comes with bragging rights. Many of the bigger properties are known as “legacy” ranches in part because buyers want to stake their claim in history. These ranches stand out for their size, unusual location or a unique feature, says Eric O’Keefe, editor of the Land Report, which publishes an annual ranking of the largest 100 private landowners in the country. To make that list requires owning 100,000 deeded acres or more.

Billionaire Stan Kroenke, who owns the St. Louis Rams and soccer’s Arsenal F.C., bought a roughly 124,000-acre ranch in 2012 near Augusta, Mont., listed for $132.5 million by the estate of William and Desiree Moore, the late co-founders of Kelly-Moore Paints. Called the Broken O Ranch, Mr. Kroenke’s purchase elevated him on the Land Report’s list of largest landowners, where he currently holds the No. 9 spot. Mr. Kroenke didn’t respond to a request for comment.Liberty Media Chairman John Malone remains at the No. 1 spot on the Land Report’s 2014 list, with 2.2 million acres."

Navajo settlement finalized

On Sept 28, 2014, the feds paid $554 million to settle a lawsuit by the Navajo Nation asserting that the federal government mismanaged tribal funds and natural resources. 

http://www.azcentral.com/story/news/local/arizona/2014/09/26/federal-government-formally-agrees-pay-navajos-million/16286209/

Here's what AZCentral had to say:

http://www.azcentral.com/story/news/arizona/investigations/2014/09/26/navajo-settlement-things-to-know/16235997/

Six things you need to know about the settlement:

• U.S. Secretary of the Interior Sally Jewell, Navajo Nation President Ben Shelly and other federal and tribal officials are scheduled to attend the signing event, which marks the largest settlement ever paid by the federal government to an Indian tribe.

• The dispute stems from charges that the federal government failed to manage, invest and account for tribal funds and resources in relation to the exploitation of oil, gas and other minerals. The tribe has more than 14 million acres of trust lands used to produce revenue.

• The Navajo Nation is the most populous Native American tribe in the United States, with more than 300,000 members. It has the largest reservation in the country, encompassing more than 27,000 square miles in Arizona, New Mexico and Utah. It is larger than 10 of the 50 states.

• Under the agreement, the Navajo Nation will dismiss its lawsuit against the federal government and forgo further litigation regarding the federal government's past management and accounting of Navajo funds and resources held in trust by the United States. The Navajo Nation and the federal government also pledged to improve communication concerning funds and resources in the future.

• Shelly, the tribal president, plans to hold town hall meetings with tribal members around the reservation to get direction about how to use or disburse the settlement money.

• The settlement is one in a series of similar actions. The federal government reached settlements with 41 tribes for about $1 billion in April 2012, and with almost 40 other tribes for a combined $1.5 billion since then. The federal government currently is involved in discussions with yet more tribes on cases that are still pending. And in an unrelated case, the Justice Department announced in April that a private mining concern would pay the Navajo Nation nearly $1 billion to clean up roughly 50 abandoned uranium mines on tribal lands.

Cobell settlement

Those who have read the book are somewhat familiar with the Cobell settlement. Here's an update on what is actually happening. 

Cobell Land Buyback Just a Dangling Carrot

Read more at:

http://indiancountrytodaymedianetwork.com/2014/07/26/cobell-land-buyback-just-dangling-carrot

Excerpt: Well, now we are finally in the midst of the Cobell Land Buy Back Program (“LBBP”) implementation, I’m wondering “did anything really happen? Cobell settled for $3.4 billion, including stipends for the lead plaintiffs, copy.9 billion for the LBBP to be used by tribes to acquire “highly fractionated interests” in individual Indian lands, attorney and consultant costs capped at copy00 million, and copy.4 billion to Individual Indian Monies account owners. Wow, $3.4 billion was awarded and a maximum of copy.4 billion to be distributed to the class members and now turning into a question of when will it actually happen. Individual Indians are having carrots dangled in front of them only to have it jerked back and rescheduled.

For the BIA's perspective:

http://www.bia.gov/cs/groups/public/documents/text/idc1-027129.pdf

Chinese buyers of U.S. real estate

Now Chinese buyers are dominating the high-end of the U.S. residential market.


We'll watch what happens in the next few months as China attempts to close this loophole, but ZeroHedge reports the outlook isn't good.

http://www.zerohedge.com/news/2014-07-10/did-china-just-crush-us-housing-market

A few days ago we finally closed the door on any argument who the marginal buyer in the US luxury housing segment was - the answer: Chinese oligarchs, scrambling to launder their "hot" domestic money abroad (as we predicted first two years ago) and now that Switzerland is no longer a safe offshore venue where one can park cash, they picked US luxury housing as the best money laundering alternative.

This means that far from indicating a recovery, as the recent surge in the high end of the US housing segment had long been touted, all the relentless move higher in ultraluxury properties prices was simply a recycling of China's hot money, which unlike in the US, never made its way into the Chinese stock market (explaining why the Shanghai Composite has barely budged in years) and merely ended up in US real estate. If anything, this is simply another confirmation of the epic capital misallocation, and the complete lack of "trickle down" resulting from failed global central banking policies.

So now that the "who" has been answered, just one question remained: "how?"

How did millions of Chinese "buyers" manage to get tens of billions of yuan or dollars out of the mainland - a country which as is well-known has strict capital controls when it comes to individual and corporate offshore outflows? Under Chinese law, citizens are allowed take only the equivalent of US$50,000 out of the country each year: hardly enough to buy a storage closet in any of New York City's Central Park West duplexes.

Today we learn the answer and it has to do with officially sanctioned "money laundering" services by not one but two of China's largest banks: Bank of China and also Citic.

Lots more on this topic here: http://libertyblitzkrieg.com/2014/07/09/chinese-purchases-of-u-s-real-estate-jump-72-as-the-bank-of-china-facilitates-money-laundering/

Black market in Indian artifacts

“The illegal trade in artifacts is very lucrative and represents a large criminal worldwide activity. Law enforcement officials understand not only the economic but also the global cultural impact of these crimes,” said Drew Northern, FBI Supervisory Special Agent.

Read more athttp://indiancountrytodaymedianetwork.com/2014/07/07/fbi-artifacts-seizures-slows-huge-black-market-native-relics-155698

My comment: There are two aspects of this story that haven't been reported, or at least not emphasized, so far as I've seen. One, Mr. Miller collected these items before enactment of the laws prohibiting such collecting. Two, Mr. Miller had the last known skeleton of a Native American giant, which will likely never be seen again.