ImDaChineze

International schools for Chinese Students for the most part refuse to hire anyone who isn't White. I applied for some part time work tutoring kids in English/SAT prep (2350 super score SAT) and was flat out rejected because the boss "only hires white people" (direct quote from the recruiter) despite my Chinese citizenship (ease of employment without work visa necessary) and having lived in US since I was 4. They attract parents there by having a kind of "zoo" of white/foreign teachers which make them seem legit

Lets say you have a game where someone draws a random ball out of a bag of 100 balls. If it is white, you get $1. If it is the single Black ball in the bag, you have to pay that person $200. You wouldn’t want to play this game as it doesn’t benefit you much, and over the long run you actually lose money.

Well, someone comes along and says “Hey! I noticed you don’t want to play this game. What if every time someone draws the black ball, I pay it for you for free! So all you do is collect $1 every time its drawn with no risk to you?”

Of course, you love free money so you say yes.

20 new people draw a ball and they’re all white, so the nice person offering to pay if you lose hasn’t actually paid anything yet.

Does that mean the nice person hasn’t given you anything of value?

The nice person assumed the ~10% risk that one of the people would draw a black ball, and at $200 a ball that means they subsidized you $20 roughly.

This is in essence what’s happening here. Taxpayers are bearing the credit risk of these loans without the benefits.

The more detailed answer is that by being able to borrow money with the full backing of the taxable income of the United States, these loans have become seen as essentially “risk-free” and thus the borrowers do not have to pay credit risk. In the same way that someone who has great credit pays a lower rate than someone who’s just defaulted from a couple loans, having a government sponsored wrapper around your loan essentially makes your rate comparable to that which the US government itself borrows at. This is quite unfair, because hey, I would also like to borrow at SOFR MINUS a spread. Why can’t you offer me a 30Y loan at the Current 30y Treasury rate of 3.56%? Why do I have to pay 7%?

My dad taught the CEO's daughter. He led a trip to China, the daughter got seriously ill, CEO flew his private jet to pick her up to take her to US

Guanxi means connections, I assume that it's inside joke

There are too many incentives for investment managers to buy up housing and close to zero regulations against them.

These managers amassing mass blocks of housing collect all sorts of management fees to help investors who want the attractive yields of real estate ownership without dealing in the day to day aspects of being a landlord. By centralizing all of the operational aspects of being a landlord, they’ve created an investable asset class with high returns and a huge underlying industry able to support a ton of investment.

Now, everyone from pensions to insurance to individual investors get to have the upside of owning houses without the pesky downsides of chasing tenants for rent or evicting them.