Friday, November 27, 2009
Who would have ever thought that debt in Dubai would someday be a problem?
In a story that sounds all too much like that of a U.S. real estate agent who, after a couple of good years in the middle of the decade decided to get levered up to the maximum banks would allow rather than paying down their debt only to watch things come crashing down around them a few years later, the debt is coming due in Dubai.
The price of crude oil in the Persian Gulf or the price of condos in Las Vegas - it's all kind of the same thing when you have a global banking system on steroids.
After what we've all been through over the last year or so, you'd think that someone would have already stepped in by now with $80 or $90 billion to make this nasty little problem go away.
It's a good thing that most everyone in the U.S. is either out shopping or sitting at home with a turkey hangover or maybe there would be a bit more selling today.
Monday is another question - it seems pretty far away right now.
Here's my favorite Dubai story from the last year or so - this February report about sagging property prices that everyone would rather just pretend wasn't happening.
And of course these cool pictures from this item in January gave the clear impression that the regional economy was still booming.
A more comprehensive set of boom town photos can be found in this post from late 2006 and, of course, a few months later, the rotating skyscraper was discussed here.
They aren't still going to build the rotating skyscraper. Are they?
Of all the things that have appeared here about Dubai, perhaps this item from about a year ago was the most precient - New strategy - long ammo, short Dubai.