China: big bad sign #1 (money leaks out)

Wealthy Chinese citizens are moving their money abroad: "buying beachfront condos in Cyprus, paying big U.S. tuition bills for their children and stocking up on luxury goods in Singapore, frequently moving cash secretly through a flourishing network of money-transfer agents."

Last 12 months, estimates the WSJ, 3% of China's GDP slips overseas this way.

Two ways of looking at this:

1. When locals move cash, it's because they fear a crash, and who knows the local situation better?
2. The rich fear for their wealth in China.  They know they've amassed "too much" and/or they know the Party won't do what is necessary to protect it with rule of law (see, Bo Xilai).

Either way, not a good sign.

After all these years of do-nothing Hu, Xi is going to be under tremendous pressure to fix things.