We all know: “Money is not everything, but without money is really everything”, let’s talk about the almighty money today:China’s digital currency, first look at this news, August 14, 2020, issued a “digital currency pilot general program”, the program is very clear, from March this year, the digital currency officially began circulation.
About digital currencies. I’m not going to waste time on the basics. The digital currency is issued by the central government and is a central bank liability, equivalent to legal tender, and has national credit.2: The digital currency is issued to save costs by eliminating the expenses of making, counterfeiting, printing, transporting, and securing ordinary paper money.3: After the traditional paper money is issued, there is basically no effective means of monitoring its circulation, and there is no way of knowing what it has done or bought. There is no way to know what it has done or bought. Digital currency, on the other hand, can readily collect, account for, and flow data, and through big data analysis, it can provide valuable reference for currency placement and monetary policy formulation.4: Effectively combat money laundering, fraud, tax evasion, and other illegal crimes. To put it bluntly, the central bank knows exactly where everyone’s money is spent. This means that the hotbeds of money laundering, tax evasion, terrorist financing and other crimes are knocked out. 5: The introduction of digital currency will promote further transparency of personal assets.
From the above, it can be seen that the convenience and security of digital currency is basically good for the common people’s working class, and it has no effect on the second generation of powerful officials, because China has never been a “criminal without a scholar”, but digital currency is definitely bad news for the Chinese middle class and high net worth families. Mr. Wang Jian, a news commentator on YOUTUBE, said that the Chinese Communist Party has a lot of holes in its work, but it can do nothing but bad things. Let’s take a look at why the Chinese Communist Party wants to implement digital currency. And how is it blocking Chinese middle class high net worth families?
First, let’s take a look at China’s middle-class HNW households.
According to the 2019 Hurun Wealth Report, the total wealth of “wealthy families” with $6 million in assets amounts to $128 trillion, which is 1.3 times China’s annual GDP, and of this total wealth of $128 trillion, $17 trillion is expected to be passed on to the next generation in 10 years, $39 trillion in 20 years, and $60 trillion will be passed on to the next generation in 30 years. As of 2019, the number of “wealthy families” with $6 million in assets has reached 4.94 million; the number of “high net worth families” with 10 million in assets has reached 1.98 million, and the number of “ultra-high net worth families” with 100 million in assets has reached 12.7 million. The number of “high net worth families” with 10 million assets reached 1.98 million, and the number of “ultra high net worth families” with 100 million assets reached 127,000.
The composition of “high net worth families”: business owners account for 65% of the gold collars account for 20% of the house speculators and stock speculators account for 15% of the middle class high net worth families, refers to such a social class or social group, whose age is 25-46 years old, generally well-educated, with professional knowledge and strong professional ability and the corresponding family consumption capacity. Engaged in brain work and pursuing quality of life. In short, they are in the middle to upper level of the current stage of society in terms of economic status, political status and social and cultural status. The total amount of wealth held by the Chinese middle class surpasses that of the United States and Japan, jumping to the first place in the world.
Secondly, why do many middle class HNW families choose to migrate and study abroad?
The Blue Book of China International Migration Report 2020 was officially released, and the report shows that China is now the third largest migrant exporting country in the world with a total migrant outflow of more than 10 million, and the top four migrant exporting countries in mainland China in 2019 are the United States, Canada, Australia, and Japan in terms of the distribution of exporting destination countries. The report shows: the most difficult to make middle-class families satisfied, the first child education. Many immigrants say that their children’s physical and mental health and education are their biggest concerns. The problems of pollution, medical care and education in China are difficult to change in a short period of time. According to the survey about 70% of Chinese respondents believe that: freedom of speech, privileged corruption, unfairness, security of assets, legal system and other factors are important reasons for them to migrate.
The Report also notes. In recent years, migration is no longer the traditional migration of families, and the “light migration” mentality, which does not require residence, is quietly changing the definition of migration: it tends to allow the rich and middle class to have richer possibilities in the future while stabilizing their asset allocation. Behind immigration is the foresight and forethought of the wealthy or middle class. It is their global layout thinking for elite education, wealth protection and career expansion.
Third, the developed countries in the West continue to attract a large number of immigrants: since the 1990s, traditional immigrant countries such as the United States, Canada, Australia, etc. have continued to welcome immigrants. Western developed countries have strong economic strength, social freedom, advanced education, excellent natural environment, high quality of life, the achievement of high quality and low cost of education business. Some people have made a calculation: in China, the cost of raising a child from junior high school to university, plus various school choice and tuition fees, can exactly offset the cost of immigration. It is conceivable that high net worth families migrate, taking not only talent but also money with them. The China International Migration Report shows that, according to the Chinese Academy of Social Sciences, the capital outflow on China’s balance of payments reached US$1.28 trillion in the two-year period of 2015-2016 at the peak of foreign exchange loss, as migrants converted the RMB assets in their hands into USD assets and moved offshore.
After talking about the above points, it is clear that the migration of middle class HNW families has caused a huge loss of physical capital, human capital and human resources in China. The migration of middle class high net worth families has not only taken away the property accumulated in China, the human capital formed by the Chinese government through education and training, but also a huge amount of human resources, that is, their next generation of children.
Now the question is, does the Chinese Communist government not know about this?
I guess it really doesn’t. Why? The Chinese government has always been an afterthought, first, China’s population base is huge, many people migrate without canceling the household, the government is difficult to detect; second: the leadership does not pay attention to, think more is better than less, not willing to dispatch resources dedicated to investigate statistics. Third, China’s rapid economic development in the past few decades, the country whirring to earn money, do not care about this money.
But people have no long-term concerns will have near-term concerns. Since Xi Jinping came to power in 2012, the Chinese government has slowly realized that a crisis is coming.
First of all, Xi Jinping is engaged in a big belt and road, a big spreading of money, the money spread out. When people run out of money, every coin is heavy, not to mention the trillions of real money taken away by immigrants studying abroad. So the central government ordered to hurry to check the loopholes and plug the holes, to find a way to keep all the money as much as possible. For this reason, the People’s Bank of China set up a special team to study digital currency in 2014.
The second is the untimely arrival of aging and the fact that China’s demographic dividend is going to disappear. China’s population is expected to peak at around 1.43 billion in the second half of the 1920s, after which the population will experience a historic turnaround from low to zero growth and then into negative growth.
And then what happens is that the government finds that even after breaking the birth limit, it has become difficult to stimulate the nation’s desire to have children. From 2018 onwards, the national birth population has fallen back significantly, the short-term effect of the comprehensive two-child policy is over, and the fertility level is in a downward phase. In the future, the problem of fewer children, according to relevant experts, will constrain China’s socioeconomic development, and the demographic crisis will be the biggest problem in China.
In addition, the World Bank estimates that China will start negative population growth in 2029. A study by the Chinese Academy of Social Sciences shows that the population will start to contract from 2027, and in a few decades, the number of people will drop to 700 to 800 million. The UN’s projection scenario is even more pessimistic, suggesting that China’s population will fall below 1 billion to 613 million by the end of the century. Regardless of the accuracy of these predictions, there is no doubt that China’s population problem already poses a serious crisis. Since we can’t open up the source, we have to cut off the flow and try to control the outward migration of the population.
We all know how the Chinese Communist Party works: no one pays attention to the first signs of a problem, and when it becomes a crisis, the leaders give an order and immediately cut across the board. Both money and people must be retained, but if immigration is prohibited and forced to retain people, involving violations of the Constitution and human rights, then find ways to control the money, cut off the flow of funds is tantamount to cutting off the back of immigration, the bottom of the barrel.
As we all know, the Chinese Communist government has in fact been constantly building fences to block middle-class immigrants. For example, it has restricted the exchange and transfer of funds, tightened the processing of private passports, and even seized the private passports held by individuals. In the process of transferring assets out of China, entrepreneurs and ordinary people have been using their own skills to move large sums of money out of China through “ant moving”, foreign investment or “underground money changers”. Before the digital currency, the Chinese Communist government has already completed the “real name registration system for personal property”, “real name registration system for personal marriage”, “CRS with the digitalization of money, so that the net of wealth under the sun has been completely The
The government uses digital currency, and then with the help of big data, through the change of currency form and circulation process monitoring, so that the government can accurately grasp every income and expenditure of each national, record every use of each currency, so that the government can monitor the nation’s wallet with full time and space accuracy, to ensure that the currency is used within the scope of the law. Personal assets are completely transparent and cannot be hidden. No matter what you do, be careful because “the boss is watching you. Of course. What is considered to be used within the limits of the law? You know, the Chinese government has the final say! With digital currency, the Chinese Communist Party has an additional six-vein divine sword to cut off the immigration road.
Because the Chinese Communist government is an all-powerful government, it can “set up a wallet for you”, then “manage this wallet for you”, and then “supervise your spending” until “you are not allowed to spend money that you should not spend”. The management of everyone’s money is conducive to “anti-money laundering, anti-terrorism, anti-tax evasion and anti-fraud”, for the good of the country and for the good of everyone.
The digital currency, from the standpoint of the Chinese Communist government, may have many functions, such as helping to fight corruption and fraud, and helping to establish the international currency status of RMB, but for the middle class and high net worth families, it is a sharp sword for the Chinese Communist government to deal with the international human resources war, cutting off the way for high net worth families to migrate and study abroad and transfer their assets.
So in the next 5-10 years, China will definitely set off a high tide of immigration of high net worth families. If you do not run again, it may really be too late!
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