Part of this is money laundering. Think about how easy it is to move money from say Romania to the United States.
Typically this would be very hard to do. If I want to withdraw $5,000 or more in cash in the US, I have to fill out a suspicious activity report (SAR). Transferring even under ten thousand dollars today via SWIFT can be tough (like Venmo for the international banks).
However, what if you set up a company in the US selling 16 oz organic potting soil for $400 a bag? You could place an order for 100x, get your over priced potting soil shipped to Romania, but what you’ve also done is incredibly valuable. You’ve transferred $40,000 USD across continents and essentially outside of the central banking system via the credit card companies.
Money laundering leads to grossly inflated assets (like buying a house that’s 300k over valued because you just want to store the money in a non-cash asset and don’t care about price). This affects us all, and should be studied more.
Typically this would be very hard to do. If I want to withdraw $5,000 or more in cash in the US, I have to fill out a suspicious activity report (SAR). Transferring even under ten thousand dollars today via SWIFT can be tough (like Venmo for the international banks).
However, what if you set up a company in the US selling 16 oz organic potting soil for $400 a bag? You could place an order for 100x, get your over priced potting soil shipped to Romania, but what you’ve also done is incredibly valuable. You’ve transferred $40,000 USD across continents and essentially outside of the central banking system via the credit card companies.
Money laundering leads to grossly inflated assets (like buying a house that’s 300k over valued because you just want to store the money in a non-cash asset and don’t care about price). This affects us all, and should be studied more.