Chinese Tycoons Plant Money Management Flags on Wall Street
Some 324 firms with ties to China have registered with SEC
Asset managers followed the money from China to the U.S.
Excerpt
Originally published May 7, 2017 at 6:00pm EST
When a new hedge fund opened in Mountainside, New Jersey, a leafy suburb that still holds an annual little-league parade, few would have guessed where much of its funding came from: Chinese billionaire Cai Kui.
The credit hedge fund, Westfield Investment, was founded by formerGoldman Sachs Group Inc. Managing Director Renyuan Gao and managed $139 million as of January. It’s part of a new crop of asset management firms that are expanding China’s reach on Wall Street as money has poured into the U.S. from the world’s second-biggest economy.
China’s marquee names are among those setting up shop in the U.S. Chen Feng, who controls the HNA Group airline and hotel conglomerate, hasopened a U.S. money management firm. China Vanke Co., the mainland’s second-largest residential developer, has indirectly taken a major stake in a manager. All told, about 324 firms with financial ties to the mainland andHong Kong had registered with regulators by last year, more than double the number in 2012, filings show.
They are riding the wave of capital that left China on concerns about bank debt, a real estate bubble and the yuan, which plummeted about 11 percent against the dollar in the last two years. The currency flight was reflected in balance of payments data where capital outflows tripled to $220 billion last year from $70 billion in 2014, according to Derek Scissors, a China economist at the American Enterprise Institute. […]