SA wrote:
>There are two types of foreign investment, direct (FDI) and portfolio
(cross-border purchases of securities).
>China takes a big inflow of FDI,
but then it extrudes a big outflow of portfolio investment (by buying US
debt,
>for example), yielding a roughly zero net inflow/outflow of capital.
JG writes:
Ah, SA beat me to it, depriving me of my chance to be Mr. Smartypants. Reports actually suggest that the gross outflows might be significantly understated, since a substantial chunk of China's party-state/capitalists, fearing that the masses might get unruly and expropriate the expropriators, or the PRC might otherwise unravel, illicitly hide a lot of their savings in underground offshore accounts.
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