Dubai bankruptcy (UPDATE BAILOUT!)

Honestly, this one was going to happen sooner or later.



I specially like one brazilian journalist opinion on this:

Dubai is broke. The "fantasy island", built in the recent years thanks to almost slave work of people from all over asia (India, Pakistan, Sri Lanka, among others) is now with a debt of 80 million dollars. That's the price of real state speculation, the huge "pharaoh" hotels, skyscrapers, artificial islands, the whole oil stupidity (and there they don't have that much), and of course the internacional financial spree. An arab lie, enthusiasticly embraced by the irresponsible West.

But now, the bill has arrived, you know? Due date is just around the corner. The "Sheik" checked his account ballance and then saw he doesn't have that money. Luckily it's not gonna break the whole word, because not everybody believed in this fairytale in the middle of the desert. Bad luck for those who did. It serves you right. Way to go!



Edited: Liked this one too:

Is Dubai viable?

Dubai always seemed an out of reality project. It's possible that now this megalomaniac dream installed on the desert will be "unmasked"? Or Dubai, in it's vision, it's a viable project?

Dubai is one of the seven emirates that compose the United Arab Emirates. Of those seven, it's the one with less oil. And saw, on extravagrancy, an exit to call the attention of the world and to try to become a new Hong Kong or a new Singapore.

Just that, on Hong Kong case, we had a China behind. And on Singapore's case, there's the technological development, that also guarantees a good economy situation to the country.

In Dubai, besides it's political fights with Abu Dhabi, where's the capital of the United Arab Emirates, the movement resulted in a "step bigger than the legs could do", critical situation that was helped a lot by the international financial crisis, that drove away investors and real state buyers.

Then, the attempt of it being a comercial and financial power of the Middle East started to fall to pieces, mostly because there's Bahrain, that since 1971 is a international financial center, and is only 40 minutes by plane from Dubai. It's a big contender for the ambitions of Dubai on the financial area.

By the data avaiable, we see that the biggest creditors of Dubai are also on the Middle East: It's the governments of Saudi Arabia, of Qatar and the very own United Arab Emirates, that by the way was already financing a good chunk of this dream, besides the main banks of United Arab Emirates.

It seems that now, they are trying to put some order on the house. That's why all the scare, but on the following day the markets reacted positively. Some european and american banks can be affected, but the damage is way lesser than the one from Lehman Brothers.


PS: Did a fast translation, sorry if there are mistakes. :110:

 

I just want there to be a currency weaker than the dollar.

 

Dumbai

 

Oh don't worry, here in the UK we are so flat broke and shafted by an incompetent Prime Minister, Exchequer & greedy bankers that we'll never know the full impact until years later! Just add it to the pile of crap we have to deal with, we'll eventually get 'round to thinking about it.

Bank of England bailed HBoS & RBOS out by the tune of £60Bn, backed by the Chancellor of the Exchequer (so if things had gone wrong the taxpayer would have footed the entire bill) and nobody thought to mention it for over a year! Luckily nothing did go wrong, the debt was paid back in 2 or 3 months and no harm done, or so they say.

We have been informed that such "hidden transactions" should be allowed to continue, with the taxpayer playing the fall guy in all of this ad infinitum! Me thinks the Chancellor of the Exchequer is toothless and our PM clueless.

Sick to death of our current Government & Gordon Brown (PM) who is so deluded he genuinely believes his fiscal policy is "saving the World". Utter nonsense.

If Dubai hits the fan then billions of UK investment gets wiped...

We also have a general election coming up within the next few months and this has arrived in the Labour parties lap just in time to help sink them.

 

I've had a feeling that Dubai couldn't sustain itself like that. I just don't see how frivolous spending on useless things like artificial islands has any point. No doubt after a couple of years of lack of maintenance the islands will wash away anyway.

Parris, you really don't like Gordon do you! I just kind of feel sorry for him! I do think he shoulders too much of the blame, though I guess thats what happens when you are pm. I think life under the Conservatives would be pretty much the same tbh..though I don't agree with a lot of Liberal Democrat ideas, I do think taking the UK off the 'world stage' as it were, to consolidate and solve problems at home during the next decade would be a good idea.

That and the banks need to come into line with the rest of the UK's businesses with regards to corporate governance. Its a pity that the focus was on shareholders and not the general public in the government papers post Enron.

Perhaps now that we are 'shareholders' in the banking sector we may get better treatment? I shouldn't think it will, as the recent turn around on banking charges has shown.

 

Where do you begin with the political situation in the UK? I am really disappointed that Tony Blair "negotiated" his retirement from being Prime Minister and made it possible to Gordon Brown to step into his shoes as an unelected Prime Minister. Personally I believe that once a PM steps down a General Election must be called either right there and then or within a year. It should never be allowed to happen again.

As the Chancellor of Exchequer, Gordon Brown had his eyes (pardon the pun) on the prize of being PM. He acted like a spoilt child and threw temper tantrums until he got what he wanted. In retrospect I think Blair realised his game was up, decided to leave the sinking ship and gladly handed the dubious Labour vessel over to Brown who acted like he was democratically elected.

If anyone was in a position to see where the country was going economically, it surely should have been Brown. However, he was instrumental in ensuring that British banking institutions were not snarled up and hindered by red tape and external governance and tinkering. Time after time he failed to ensure that the financial sector performed in a fashion that could be regarded as under scrutiny. Whilst the sun shone, what the hell did he care? What ain't broke doesn't need fixed! So what to do with the UKs gold reserves during a boom period? Why, let's sell off 50% of our reserves - yahoo! Not his best move I think everyone would agree!

When it all went tits up he then immediately waded in and attempted to bolt the door once the horse was galloping off over the horizon, thus ensuring that safeguards were useless. When negotiating the terms of the banking bail out he failed (gross negligence in my view) to ensure that part of the package was that banks paid the billions owed to taxpayers ahead of patting themselves on the back financially and the major banks have been given a blank cheque and told "don't do it again, but if you do, the taxpayers will continue to bail you out". So that's them warned eh! They must be really concerned.

The whole fiasco over former HBoS chief Fred Goodwin and the Governments failure to sort out his laughable contract is another example of how little understanding Brown has of people's anger.

The former chiefs of the top banks that British taxpayers bailed out were hauled in front of a parliamentary inquest and given the usual "British Thrashing", but frankly who cares if their careers are in tatters and they got a bit of a telling off, I am sure they don't care as they are multi millionaires and thanks to incompetence they'll continue to make millions in their ridiculous contracts as no one in the Government seemed keen to govern!

What else do I not like about him? Well, anyone who offers Mandelson another position in their cabinet needs their head seen too for one. It really was "I am really unpopular, who can I get onto my cabinet who is even more unpopular with the populace so that I am not the most unpopular person any more". So in he brought Mandy, who's arse licking antic make me want to throw up! If that man ends up as PM, I am leaving the UK throughout his reign of smarminess.

I'm deeply concerned about the new planning permission changes, which basically mean that anyone wishing to propose a nuclear power station can have the whole process rushed through to planning consent without public consultation (a direct result of years of Labour indecision on whether we are facing an energy crisis or not).

How about the private finance initiatives, which saw large businesses getting into bed with public sector projects, so that in effect the NHS and Education establishments are now sponsored by corporations with a vested interest. We are saving absolutely nothing and paying through the nose, especially as many of the PFIs are now falling through because of the financial situation. So, instead of a Government investing in the fabric of society, it's fallen by the way side.

Oh, the failure of the Government to tackle the farce that was the IT infrastructure at the back of the NHS, which has been a nightmare!

My list could and probably would go on and on, it's a Labour party I voted for and I am deeply ashamed to say lost my confidence many years ago only to have insult compounded by absolute frustration when Gordon Brown bumbled in and took the helm of the sinking ship, only to steer us into the rocks at the first convenient opportunity he had!

No, I am no fan!

As for David Cameron.... God, what choice does a Labour voter have these days?

 

David Cameron = Tony, 12 years ago.

 

Without the charisma, charm, panache or Yamaha Pacifica guitar.

 

Actually, Dubai's currency has been set at a fixed exchange rate with the US dollar for decades.
Dh3.67 = US$1.00
It doesn't change, so the value of their currency has dropped at essentially the same rate as ours. Certainly a contributing factor in their current financial problems.

 

To compound matters the UK banks were in court last week over the charges they apply to accounts that become overdrawn without having overdraft facilities. Many account holders are simply barred from having various additional extras, such as overdrafts on their accounts due to their financial status, employment position or previous credit history.

Anyway, for several years individual account holders have complained about being charged up to £30-35 for going overdrawn for as little as 1 pence. These charges are applied on each request presented to your account with (I think) a maximum of £90 per month (perhaps more or less depending on the bank), so some people who had relatively low incomes, students and anyone caught out by the mounting unemployment issues found themselves incurring hundreds, sometimes thousands of pounds worth of charges over long periods. This was contested as unfair and without justification. The banks argued that it was an administrative charge. Some banks were charging less, say £12 and the argument began regarding precisely what was deemed a fair administrative fee or whether in fact it was lawful.

The cause became national, thousands of people were taking banks to court and in many instances finding that their banks under the strain of the numbers of people claiming, decided not to even bother turning up in court.

Years of these individual and group actions led to the "Office of Fair Trading" going to High Court after previous rulings suggested that there was a case to be had against the banks. This test case last week was thrown out by the most senior Judge. He however speculated that the OFT should review it's argument as some aspects of the case were potentially viable.

The banks claimed an immediate victory... once more saving themselves from having to pay out millions of £s worth of charges applied to accounts throughout the UK.

The Government couldn't really do anything because rumors had circulated (presumably by the banks themselves, who later refuted the claims) that they'd simply ensure that bank accounts had to be paid for in future. This was a highly unpopular move and something the Government clearly thought might affect even more bank holders.

Nothing like a double whammy as the news of this broke on the same morning that they announced the $60Bn bailout.

It's great to be a UK taxpayer right now!

 

And yet, despite it all the UK pound remains strong. The global recession still hasn't really impacted the value of the sterling.

-hl718

 

That might be because someone else has all our money lol

No, you are right it is a strange phenomenon that Sterling remains stable at a time when the UK economic situation at home is in crisis.

 

Huh? Against the Euro it's holding about 1.10 (never did get to parity like all the experts were saying) but even so it's the lowest it's been for nearly 20 years. On average the euro has been worth around 1.45 with a peak of 1.72 back in 2001. Not sure how you mean it's stable...

The dollar? Its hold at around $1.60 to the pound which is to most experts the waterline and a look at the average over the last 20 years shows it's holding steady. Although it has yoyoed from 2.1 to 1.4 a few times over the last 2 decades... Although lets be frank the dollar is fairly weak and no wonder the Euro is quickly becoming on the currencies of choice.

The Yen? Although it's recovered from it's lowest of just over 120 yen to the pound to around 145, it's still low. During the recession of the 90s it did drop to around 140 from a high of 275 yen to the pound it did on average stay at around 180 yen to the pound.

The pound is also it's lowest ever against the Australian Dollar, the graph in the last 10 years just looks like a downhill skislope... Ditto Canadian Dollar, the Norwegean Kronar and even the Vanuatu Vatu...

Still can only get a little worse... before it gets really bad in 10 years time when everyone has noticed that Gordan, Major and Maggie sold off all the family silver, the kitchen, the bedroom, the fittings, the carpet even the light bulbs. I can see the UK leaving the EU, renationalising all PFI schemes and industries and the pound being stable but pretty much worthless against the major industries.

Still hopefully one labour backbench MP will have the bollocks to stand up before the general election and stand against Brown in a leadership contest. It's interesting to note that this government has had more votes against the party whip the any other government since the war as well as having the highest amount of government bills defeated (due to said votes against party whip) too.

 

Somebody got a link about this? I'm not seeing anything about a bailout on some sites, just the debt problems, and when doing a google search all I'm finding is information from the February 10B bailout.

 

Are you high? I just came back to Japan with 60 GBP in my pocket, and got 7500 yen at the airport. Most of my tenure here I would've gotten that with fucking dollars.

 

politics = lolitics

 

I m not sure many of you know this, but the value of Pound Sterling isn't set by market factors like in other countries.. ;P

On a side note, seeing the GBP go low so fast makes me wonder how much longer you'll resist the change to Euro currency. It's unavoidable and I think there's a deliberate depreciation/equilibrium in order to speed up this change.

 

Had Tony Blair become President of Europe, I think it would have been a far swifter entry into the Euro Zone, which is one reason I believe he got so little support in the UK. That and the fact he's a twonk!

Yeah, I agree and I think if (and it's a BIG if) Scotland gains independence (SNP are calling for a referendum and all other parties are threatening to join forces to block a public vote) then I suspect that Scotland would be keen to move to the Euro ahead of the rest of the UK.

Without that happening then I still think we have a good few decades of dithering and defending the Pound against the Euro. It's just the way British Government and the majority of the public react, it's as if they still truly believe that Britain has some Empirical basis and is better placed in the World than many of it's European counter parts. That may have something to do with denial and of course the historical "Special Friendship" with the USA, which these days really is on it's last legs.

Britain is in serious danger of becoming irrelevant on the World stage without swift & major changes.