There was an interesting business news piece off Tuesday night's Plus-Minus show on Channel One (ARD) here in Germany. The discussion? A roughly 15-minute piece which discussed the extent of money-laundering going on within Germany today. It is worth a viewing.
The German government believes that there's more than 100-billion Euro (125-billion dollars for Americans)....that float through the German economy quietly.
Blame? Well....the storyline leads to this idea that Germany is now number one in Europe in terms of money-laundering. A lot of this money is shifted around....ends up as cash used to buy apartment buildings (which return legit long-term cash flow) or funds the construction of condo buildings...which are sold as legit cash later.
Is the 100 billion number accurate? Anyone's guess. It might be double or even triple that number.
2 comments:
It would at least be a good thing if it would have the effect of lowering the overall price of real estate but that’s definitely not happening in Hessen.
What the journalists won't jump into and try to gauge....is the amount of hype on prices that you can draw the line back to money-laundering. Some PhD guy should sit down and estimate just one single city, and the effect. I'd be guessing that 25-percent of the dramatic increase in housing cost...leads to money-laundering.
But I'll point this out as well...various non-mafia folks are engaged in either in 'staging' money or money-laundering. Example: lot of Chinese export folks don't want their millions yearly in profit to lead back to China. They'd rather hide this profit, and one day...just exit China to safely live elsewhere. These folks are also finding schemes to invest the money and sit on it. I think if you went around to Vietnam, Indonesia, and South Korea....I could find efforts where money is pushed into real estate schemes to hold money out of reach as well.
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