Quote:
Originally Posted by J____
took out a 3 million mortgage at 2-3% to purchase a 5 million dollar Vancouver house, then took the 3 million and put it in a Chinese bank's term deposit to get back 5% interest. Free money, great for banks and the person with enough funds to do this but it really fucks over the working class in Vancouver...
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Doesn't work (aka. forward exchange rate, no arbitrage)
People doing this are stupid and doing it at significant risk.
(e.g. Many corporations and governments in developing countries took out massive loans in USD during the past few years, they saved a ton of interest with the low USD interest rate (3% vs 8%), but now they are getting screwed having to pay back in USD with the USD up 30-50% against their local currency...there is no free lunch)
I think CRA should just start taxing the influx of money immigrants are bringing in, regardless of source or the person's residency...it is not very fair, but...
they can afford it.