There are reckless lenders as well as reckless borrowers and the two must share the difficulties and troubles which may be in store for them 7 in the future. One obvious area of risk is that those who are providing the finance from abroad may reassess their willingness to go on doing so.
A sharply increased cost of overseas finance, for example, could dramatically alter the situation facing many New Zealand households. The external finance we now use takes a variety of forms: some short-term and some long-term; some debt and some equity; some in New Zealand dollars and some in foreign currency.