China's Rich Hiding $1.4 Trillion In Wealth, Study Says

nytimes.com:

BEIJING -- China's households hide as much as 9.3 trillion renminbi of income that is not reported in official figures, with 80 percent accrued by the wealthiest people, a study showed.

The money -- the equivalent of $1.4 trillion, much of it most likely "illegal or quasi-illegal" -- is the equivalent of about 30 percent of China's gross domestic product, according to the study, which was conducted for Credit Suisse and published last week by the China Reform Foundation

Read the whole story: nytimes.com

Comments

[Gomorrah]

10:46 AM on 08/19/2010

Lucky for Pakistan. Their rich and loyal friends will come through eh.

[ValdaDeDieu]

12:02 PM on 08/16/2010

So...does this conflict with, or bolster the new headline that China has now become the 2nd largest economy? Maybe with all this wealth they're hiding, they're actually the first. Do they have a tax base? In ancient times the hierarchy of the Chinese society was: 1st: Scholars, 2nd: Peasants (since the supply of food depended on them, 3rd. Artisans, 4th. Merchants. In America, the 1st citizens are now Corporations.

[GenosseJoe]

07:10 PM on 08/15/2010

China has a high personal income tax and rather intrusive socialist government.

Tax evasion is inevitable under such condition.

But China has a very low corporate taxes and it attracts foreign capital.

If US will rise our income tax and an already high corporate tax, we will loose more businesses to China and people will hide their incomes from the government as well.

[Loveismreligion]

10:46 PM on 08/14/2010

If I went through what they did.. I would hide my money too...

[melton244]

09:38 PM on 08/14/2010

Where do you think they learned their corruption/bribes practices ???? The good ol' USA.

[GenosseJoe]

07:12 PM on 08/15/2010

You underestimate the ability of the good old socialism to teach people to file false reports to government.

[FreedomCorpse]

08:36 PM on 08/14/2010

the $7 trillion or more of profit from unregulated market trading that has been hidden away in offshore accounts from US investors makes china's wealth hiding seem like child's play in comparison.

[osage]

10:49 AM on 08/14/2010

HOW THE REPUBLICAN PARTY DESTROYED THE AMERICAN ECONOMY

Four Deformations of the Apocalypse

http://www.nytimes.com/2010/08/01/opinion/01stockman.html

By DAVID STOCKMAN

August 1, 2010

“IF there were such a thing as Chapter 11 for politicians, the Republican push to extend the unaffordable Bush tax cuts would amount to a bankruptcy filing.”

“The nation’s public debt — if honestly reckoned to include municipal bonds and the $7 trillion of new deficits baked into the cake through 2015 — will soon reach $18 trillion. That’s a Greece-scale 120 percent of gross domestic product, and fairly screams out for austerity and sacrifice. It is therefore unseemly for the Senate minority leader, Mitch McConnell, to insist that the nation’s wealthiest taxpayers be spared even a three-percentage-point rate increase.”

“But the new catechism, as practiced by Republican policymakers for decades now, has amounted to little more than money printing and deficit finance — vulgar Keynesianism robed in the ideological vestments of the prosperous classes.”

“But the trillion-dollar conglomerates that inhabit this new financial world are not free enterprises. They are rather wards of the state, extracting billions from the economy with a lot of pointless speculation in stocks, bonds, commodities and derivatives. They could never have survived, much less thrived, if their deposits had not been government-guaranteed and if they hadn’t been able to obtain virtually free money from the Fed’s discount window to cover their bad bets.”

[twmorganstern]

08:57 AM on 08/14/2010

Aww that is soo cute! They are growing up to be just like us! Who says the US isn't still a world leader?

[zoemonster]

10:09 PM on 08/13/2010

China's rich hiding their wealth.

Sounds just like America to me.

[bc231]

01:02 PM on 08/13/2010

Normally, if you ask an average Chinese how are you doing... they will most likely to tell you "so so" or "just ok" "not so good" at the most "not so bad", even they are doing extremely well. But if you ask an American how are you doing, they will tell you "I'm doing great", "fantastic", "never better", "just fine", even when they are not doing well. This just shows the difference in culture. One likes to tone down or outright hide their accomplishment, and the other one likes to flaunt or embellish their accomplishment.

The reason for Chinese hiding their wealth or accomplishment comes from thousands of years of lesson that whoever flaunts openly will invite trouble or even death. Most Chinese have a habit of not letting others (even enemies) figure out how much they have or own, just to protect themselves from extortion, robbers, or corrupt officials seeking to seize or extort money from them, or friends and poor relatives trying to borrow money from them, etc.

Most Chinese in China or Taiwan or SE Asia even though they have tons of money, they have a habit of seldom revealing what they truly have... in fact a lot of them are always crying poor and telling people that they don't have much... that is why it is very hard for the Western system to figure out how much the Chinese really have or own...

[InfinteShibumi]

01:54 PM on 08/13/2010

Precisely! An astute observation on all points. Fanned and Faved!

[melton244]

09:40 PM on 08/14/2010

Well said. Like player poker, hold your cards tight to your vest and tell noone .....nothing!

[msjimmied]

12:56 PM on 08/13/2010

They have it in the mattresses, our guys just go to the Cayman Islands.

[pauldeba]

12:37 PM on 08/13/2010

Unassailable statistics here:

"The study, compiled in 2009, is based on interviews with families... "

The title on Huff Post is worng, it is income, not wealth, that is being hidden.

[altohone]

12:28 PM on 08/13/2010

Bad commies, no sharing.

[FogBelter]

12:27 PM on 08/13/2010

Could also be cultural. Chinese traditionally don't trust banks and keep their assets secreted elsewhere.

[FoonTheElder]

12:25 PM on 08/13/2010

America's underground economy is estimated to be at $1 trillion per year.
http://wsjclassroom.com/archive/05apr/econ_underground.htm

On top of that:
"It is not clear, but it is estimated that there is at least US $11.5 trillion held offshore in wealth and yet as the Tax Justice Network adds, “this does not include the laundered profits of businesses which operate through offshore tax havens to avoid tax. Nor does it include the financial assets of those whose wealth amounts to less than US$1 million. The total sum of money currently held offshore is not known.”

http://www.globalissues.org/article/54/tax-havens-undermining-democracy#Howmuchmoneyisheldinoffshoretaxhavens