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writingsonthewall

Listed below are comments made by writingsonthewall between Friday, 27th November 2009 and Friday, 27th November 2009.

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Dubai: Just a sideshow? 5:01pm on 27 Nov 2009 I just checked the UK debt clock and we're at:

£820,875,870,541

Have a good weekend - you might not get many in the future as we'll all be working to pay it back.
Dubai: Just a sideshow? 4:43pm on 27 Nov 2009 I hate to appear self-flagelating but.....

The countries with the biggest property bubbles seem to be the UK, Spain, Dubai and the US.

The countries with the biggest number of ex-pat British are Spain, Dubai and the US (i'm assuming this, it's not a fact)

....does anyone else think we might be exporting our obsession with housing bubbles?

....or am I speculating without really knowing what I am doing???
Dubai: Just a sideshow? 4:24pm on 27 Nov 2009 I'm sorry to keep picking on you Stephanie - but it's my job.

"But this isn't an Iceland. Let alone a Lehmans."

...nor was Iceland, until Iceland happened, and nor was Lehmans, until Lehmans happened.

In fact, nor was LTCM until LTCM happened - the point being that none of these events were 'like' another until they actually happened - and each one was effectively unique - making prediction impossible and consequences disasterous and unexpected.

I wonder when we reach the end of the world some smart journalist will say "it's no end of the wor...."

The most frightening thing about this whole episode is that they were able to keep it quiet. This must have been brewing for a while and it goes to show how free information is crucial to make sensible investment decisions.
If I were an investor I would be running for the hills - if they can keep this quiet then what else is hiding under the stairs....
Dubai: Just a sideshow? 4:15pm on 27 Nov 2009 I was slightly surprised by the FTSE's reaction today (although the reaction of the FTSE no longer bares any relation to the actual state of the Economy).

However, having seen the Dow today (they're back from holiday) they see it as a little more than a sideshow.

Don't be surprised if we get a ping-pong effect as each market triggers the next one to start down the following day. If it's really bad you get the Asian markets pulling down the European ones and then the American ones - and back to the Asian....
Dubai: Just a sideshow? 4:09pm on 27 Nov 2009 5. At 2:17pm on 27 Nov 2009, Slungiehill

I agree - Dubai and many Middle Eastern countries are employing the 'Las Vegas model' of Economic management.

This works fine during boom times as it's effectively tourism - but when the tourists dry up you need to find another USP. In Vegas they engage in activities which are illegal elsewhere (gambling) - but the strict law in Dubai isn't going to allow that - oh dear.

Still, it might prove the adage once and for all that you cannot build a house on sand! (and indeed nor an Economy)
Dubai: Just a sideshow? 4:03pm on 27 Nov 2009 15. At 3:43pm on 27 Nov 2009, Doctor Albion

....and from a source I have who lives there - the rents have been going through the roof all year as there is no rent control or guidance on rent levels.

In order to fill the credit gap the landlords are jacking up the cost of living. It sorts out the short term problem but creates a long term one as people depart your country or demand higher wages to stay there.

However what Stephanie says is actually true - this is a sideshow, as was Northern Rock, HBOS, RBS, Lloyds, AIG, Lehmans, GM etc. they are all sideshows to Capitalist overproduction which is the cause of all the forced destruction of Capital as the diminishing profit margin is finally discovered by the realisation that credit was being used to fill the gap created by the contradictions of Capitalism.

....however I don't expect the BBC to be so insightful - they would rather concentrate on the who, what, where and how - never the why.
Dubai: Just a sideshow? 3:54pm on 27 Nov 2009 "Especially since it is Nakheel Construction that has asked for a standstill, not the whole of Dubai World. "

So mis-information being provided by the media? - I thought there were rules by which financial journalists are bound?

"[B]oth sides have a bargaining chip. For Abu Dhabi it's 'we will bail you out'. For Dubai it's 'if you take us down, you take down the UAE' - just look at the rising cost of borrowing in places like Saudi, Kuwait and Bahrain."

This sounds like a familiar story - but maybe last time it was Banks - 'Bail us out or we'll take the Economy down with us'

....and who says the moral hazard is dead?
Dubai not too big to fail? 1:12pm on 27 Nov 2009 144. At 11:58am on 27 Nov 2009, wuddychunk wrote:

"It`s well known that the private sector is more efficient than the public sector"

Based on what exactly? Targets? Profits? Satisfied customers?

So many people blindy state that the private sector is more efficient.

Well - is the private sector resource allocation (finance) working efficiently at the moment? Did it work well during the boom (with hindsight)? - in both cases the answer is no.

The private sector claims it's more efficient - simply because it's able to extract 'excesses' from customers and staff - but this doesn't mean it's efficient in all respects - in fact usually the private sector is better at hiding those inefficiencies - i.e. in the quality of the final product, the conditions of the workforce etc.

There is an old saying that if a job needs doing, it needs doing properly - this is not applicable in the private sector. That's why most of the 'private sector produced toys' you buy this christmas will be broken by boxing day.

When your main aim is profit - achieved through sales - then why produce something of everlasting quality? It makes no sense - and yet the same old yarn is spun out time and time again to convince us that the private sector is an efficient machine.
Dubai not too big to fail? 11:38am on 27 Nov 2009 If you want to get an idea of the scale and depth of lies being told by corporations - count how many rights issues and re-financing has occured this year with the reasoning of "we're looking at making acquisitions".........

....and then see how many acquisitions there have actually been.

This tells the tale of the extent of the lies - to be fair, many rights issues were this year and the market may be too high for acquisitions at the moment, however cycnically I think most rights issues were about survival - but of course we're all treated like mushrooms and kept in the dark - possibly because the 'adults who know better' don't think we can handle the truth.....

.....so is it any wonder when we act like children and throw a tantrum (revolution)?
Dubai not too big to fail? 10:28am on 27 Nov 2009 After much lambasting of moaning Lloyds (small) shareholders I have been proven wrong with this little tale of the shareholders meeting

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/6664555/Lloyds-Banks--turkeys-are-well-and-truly-stuffed.html

Whilst the story is a bit depressing from their honesty about their influence in voting - it's very pleasing to see they are trying to show the 'idiocy of the masses' by showing up the board and large shareholders for the reckless decisions made on the basis of incestuous but unjustified trust. It also shows how joint stock companies are virtually non-democratic and not run in the best interests of all shareholders (it's just a few large ones)

My tribute to the 2000 or so - like Leonidas and his 300 they forlornly stand - outnumbered by millions - but they do stand .....and that is more than anyone can ask.

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