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they are made of paper and are burnt as offerings to the deceased.
There's no such race like 'chinese', so #4 isn't racist. It good ol' xenophobia.
The chinese (and Buddhists as well) believe in the afterlife
These "props" that you see aren't to prevent it from being stolen.
There are to be "burnt" as offering to give their deceased / next of kin / ancestors for their usage in heaven/hell/purgatory