The past couple of weeks has surely been one of utteruncertainty, black swans appearing simultaneously in various partsof the world, and an administration which seems to still notbelieve nor understand the full nature nor magnitude of the majorthreats which exist in Europe and the Mid East. Numerous expertshave publicly stated that the terror threat to the US is nowgreater than it has ever been. The Polish prime minister statedthat the world may be on the verge of war in Europe, and Israel haswaged war to destroy a terror group which most American allies inthe region know to be highly dangerous and in need of annihilation.It seem sonly the US administration and Merkel fail to get it.Putin operates from the standard dictator play book and isrelatively impervious to sanctions. If anyone complains too loud hewill simply kill them or if they are lucky, just throw them injail. Sanctions have never won the battle in any country. Wherethey eventually had some impact like in South Africa it took manyyears. In the end it solved nothing and the replacement governmentwas far worse than the white government as to corruption anddelivering poverty. Iran has withstood sanctions for years andfinally it was Obama who blinked, not Iran. Sanctions will donothing to dissuade Putin. He is a master at the geopolitical powergame, and he well understands how to play Obama and Merkel forfools.

While all of this goes on, a massive change is taking place inChina. The new premier has determined, correctly, that if themassive corruption at all levels is not stopped, there will in timebe another revolution to overthrow the communists. As Chinese getmore educated and more are educated in the US and the UK, they comeback demanding a different way. The internet lets them communicatewidely. China has to change or the people will rise up and changeit. The result is to make examples of the most senior and powerfulcrooks, The result is a massive shut down of the extravagance offive star hotels, expensive watches, trips with the mistress, andopulent homes and cars. So where does all the hidden cash gonow? A large amount to the US and for real estate. I amdirectly involved in potentially bringing one pool of funds fromwealthy Chinese for investment in the US for real estate, and thenumbers are huge. Hundreds of millions of private funds. And I amjust one small bit. It is all very quiet and unseen, and totallyoutside the normal Wall St and institutional channels.

So what does all of this mean to US real estate. As I havestated before, there is a massive flow of flight money to the USfrom China, Russia, the Mideast, and Europe. It is not to the pointthat for top US developers, just saying you have a big check isunimpressive. It has to be real, it has to have representativeshere and in those countries who have the discretion and trust tomove quickly, and IR cannot be the criteria. Programs like EB-5,which will soon be shown to be scams on typical Chinese investors,are just a drop in the ocean of capital. They are slow, smallnumbers and costly to arrange. The funds I see are huge and aresingle individuals or groups of very wealthy individuals pooledunder one advisor in China who has the trust of the investors, andpeople here and complete credibility here.