ive just been reading page one of this thread and i watched the 60 minutes piece House of Cards and thought I'd share a bit of what I have read and interpreted about the sub prime crisis. There are obviously multiple factors at play, but this is as i understand it.

Predatory Lending, an illegal practice in the states, was used to effectively con people into accepting loans they could not afford. The good percentage of those taking these subprime loans were poor; poor credit history, poor financial situation, poor financial education.

all these dodgy loans were then packaged up and sold as 'gold' investments that we now know have turned to mud. companies worldwide that invested in them, have lost big.

In itself this is bad enough, for greedy financial institutions to suck the life out of people not equipped to understand their position. Sure, they should have known better, but they didnt. They got loans at IR of 1% for a few years not realising that when this term expired they would move onto considerably greater rates (in the 60mins vid it was 14%)

But, here comes the interesting bit: some people out there recognised the problem. Those people happened to be Attorney Generals. Led by NY governor Eliot Spitzer, the 50 state AG's took action against the companies handing out the loans, reaching settlements and then introducing laws to stop it happening again.

The Bush administration didnt want this to happen. they went against  the AG's, instead siding with the finance sector and invoking its own regulatory body to stop the AG's individual states from protecting their citizens through these new laws. Spitzer, already an anti corruption crusader intensely dislkied by Wall St (nicknamed 'the sheriff of wall st) launched a NY AG investigation but was sued by the Bush govt on the grounds that curbing pred lending stopped consumers access to credit.

This of course made Spitzer Public Enemy No 1 in the eyes of the Bush admin. After all, CountryWide, one of the biggest sub prime lenders, is also one of the main contributors to the Bush Republican Party, as are many of the others.

On Valentines Eve 2008 Spitzer penned an article in the Washington Post detailing the misdeeds of the financial companies and the Govt http://www.washingtonpost.com/wp-dyn/content/article/2008/02/13/AR2008021302783.html .

Foolishly, while in Washington writing the article, Spitzer ordered a prostitute to his room, all unknowingly while being wiretapped by the FBI. His article was published however not long after whispers emerged of a high profile politician being busted in a prostitution ring scandal. Three weeks after the article was published, Spitzer was forced to resign and it came to light that he had two previous liasons with hookers. After his challenge to the Administration article though he needed to be silenced and the resulting media circus failed to focus on his ongoing investigations but on the call girl herself.On the day he resigned the Govt announced its multi billion bailout of BearSterns and other lenders….

None of this starngely has made the major outlets worldwide, possibly because most of those corporate controlled conglomerations are also major backers of the Bush Admin and benefit from their policies. Greg Palast at gregpalast.com did though if anyone is interested in further reading.

So I figure thats where the mess we are heading into is partially coming from.

gday

i lived in nz for 3 years and kept an investment property in sydney

good news is you can claim your Oz property in both countries.

You get tax credits in Australia (assuming you are neg gearing), and payments on Oz prop bring your NZ taxable income down.

There is a witholding tax though but in my limited experience and knowledge i think it works out pretty good.

but talk to an accountant experienced in this and get it from the horses mouth