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San Francisco to Become U.S. RMB Financial Center

San FranciscoFamous for a variety of reasons, the City by the Bay could soon be adding currency trading center to its resume, as it sets out to become the West Coast hub for currency transactions conducted in Chinese Renminbi (RMB).

If successful, San Francisco would join ranks alongside Hong Kong, London, and Singapore as centers where offshore trading in RMB has already been established and is growing.

China has been slowly opening up its financial system, and a major area of attention has naturally been its currency, particularly in regard to forex (FX) trading.

While some may lament that San Francisco (actually most of the United States) has come late to this party—partly perhaps to the hubris of having the world’s reserve currency—the city is serious about the venture, and local leaders have voiced enthusiasm about the positive economic possibilities it would create.

But what of the unintended (intended?) consequences of being the U.S. hub for China’s FX trade? Potential consequences in property prices, for example. San Francisco is home to a large Chinese population, and with property prices already exorbitant there what will happen when you can actually hold bank accounts and invest in RMB?

US developers have already reached out to Chinese banks for investment, so imagine for a second if large-scale RMB investment were suddenly availabile. Property prices in San Francisco still have room for more hot air… they always do. That is, until they don’t.

H/T: CCTV AMERICA

  • Ramen

    I’m not sure savvy Chinese want to invest in the US now. FATCA is definitely a deterrent for many not to try and obtain a green card now. Honestly, what advantages does the US market actually provide any longer? Unless you have an army of lawyers to help you somehow, I fail to see any.

    • curtis

      other than possible bragging rights, i can’t imagine any savvy chinese wanting to invest in property there either, ramen. but are there enough “less savvy” with money to throw around? no matter the nationality, there always seems to be those willing to.

  • Cali

    Inner San Fran will be worse than Dubai soon. An uber-rich play resort, while the service workers live out in the suburbs in ghettos.