# Is the Dubai economic bubble about to burst?



## Gaza (Sep 22, 2008)

Is the Dubai economic bubble about to burst? From where I am sitting it certainly has developed a big leak!

•	Job offers being withdrawn.
•	Projects being put on hold
•	Stake in Emirates Airline being sold
•	Redundancies
•	Government admission of a slow down

The saying: “If it looks like a dog, barks like a dog, it probably is a dog” springs to mind.

My question is what will a full blown recession in Dubai look like? With borrowing at more than 100% of GDP the Government of Dubai have nowhere to go. They would be 100% reliant on a bail out from Abu Dhabi or other GCC states. If that was to happen what would the price be?

For those who are saying a recession in Dubai will last less than a year I suspect you have fallen for spin techniques even greater than those of Alistair Campbell.  Dubai seems to have gone in to this with its eyes closed. “We are largely immune” seems to have been the mantra (it is what I was told by the CEO of the company I was due to work for) but it seems they were not immune and in many ways I think Dubai is significantly more vulnerable than some countries.

My view is if Dubai gets in to deep doodoo it will take years to pull itself out. The “New Dubai” economy was largely built around tourism. If the rest of the world remains mired in recession then the tourists will not come. High hotel costs, traffic congestion, and the appearance of Dubai being one large building site will not aid the case.

It is my understanding that a lot of private development has been funded by individual speculators/investors. If these investors cannot see an acceptable return and suspect that the property market in Dubai will follow most of the rest of the developed world and see a property slump it will be a long time before they come back to the party. There also is the risk that worried speculators/investors will try to dump their properties in a hurry and cause significant house price deflation meaning that it will be almost impossible for developers to sell new properties.

I also believe the world of private investors has suffered a seismic shift. For many years huge individual City and corporate bonuses have been used to fund investments and lavish lifestyles. The days of enormous bonuses are over. I doubt we will ever see the likes again. If there is no “money to burn” then where will the funds for future (and current) developments come from?

Dubai has also tried to sell itself as a major international financial centre. I firmly believe that option is dead in the water. With greater international regulation to prevent a reoccurrence of current world financial situation I can’t see Dubai making it in a heavily regulated world. The lack of democracy and openness will see to that. 

So if tourism at best stays flat and being an international finance centre is dead, where does this leave Dubai’s economy?


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## QS & Kids (Sep 25, 2008)

Gaza said:


> So if tourism at best stays flat and being an international finance centre is dead, where does this leave Dubai’s economy?


In the hands of politicians, criminals, and racketeers.


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## Andy Capp (Oct 5, 2008)

QS & Kids said:


> In the hands of politicians, criminals, and racketeers.


That sounds familiar....​


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## DXB-NY (Oct 6, 2008)

this part, you have to think, a lot of pple want to jump on the "believe in good wagon". I have noticed that ahem the media here is not very objective at all, and they rarely report anything news worthy. All the news i have read on the decline of Dubai has come from either reuters or bloomberg. So go figure. They are denying a bust when it wont do them anygood.


Gaza said:


> “We are largely immune” seems to have been the mantra (it is what I was told by the CEO of the company I was due to work for) but it seems they were not immune and in many ways I think Dubai is significantly more vulnerable than some countries.


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## Gaza (Sep 22, 2008)

> this part, you have to think, a lot of pple want to jump on the "believe in good wagon".


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## Easy Rider (Oct 23, 2008)

One 'classic' argument is that Abu Dhabi will come to the rescue and help Dubai out of this mess. It's been used over and over again. Whilst there might be some truth in it, 1. Abu Dhabi will not lend money to Dubai for free (see for example how Dubai had to put EK and several others 'family jewels' as collateral), and 2. The oil wealth accumulated by Abu Dhabi, however great it might be, will never be sufficient to support Dubai's business model in the long or even the medium run. 
In short, no, Abu Dhabi will not be Dubai's white knight. Will help sort out the current mess but I'm affraid that's about it.


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## DesertStranded (Oct 9, 2008)

So should we all start packing?


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## flossie (Jun 9, 2008)

DesertStranded said:


> So should we all start packing?


No. I think those of us who are left (touchwood) will enjoy less traffic, less construction, cheaper rents and a less frenetic way of life. I hope so, anyway. (Still feel terrible for anyone that loses their job, though. Been there, done that and it wasn't fun!)


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## flossie (Jun 9, 2008)

QS & Kids said:


> In the hands of politicians, criminals, and racketeers.


Not much will change, then?


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## stevieboy1980 (Sep 9, 2008)

im in construction, so many jobs have been binned, on hold and alsorts, i am told just like this thread says, abu dabhi, will be no where to be seen.....
many people are saying dubai is stuffed, but then look at other countries... where would we go, back to uk? no chance? anywhere else... pffft...
The only country Im hearing that is starting to spend money NOW and big time is Qatar, my mate just got a job there and his salary is well put it this way, people would faint...

World Economy is crazy...

Thank our stars we currently have a job (as floosie said, sorry to those that do not) but trying to get a job now anywhere would be VERY difficult...

Our company reckon we have to bear with it, and slowly sail along for about 1 year, then it will settle down, but im not so sure...
Why dont a country just print tons of money!!!


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## Gaza (Sep 22, 2008)

> Why dont a country just print tons of money!!!


It can be an answer but can cause opther issues such as inflation and the devaluing of exiting bonds. Japan tried this and got itself in a mess.

The problem with the UAE is the Diram is not seen as a major currency. It is linked to the US Dollar. Any attempt to print more money would probably mean it would be devalued and consequently would not only affect Dubai but the other Emirates. I can't see AD being happy to suffer a devaluation because of Dubai.


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## stevieboy1980 (Sep 9, 2008)

was only kidding about the last bit!!!!

maybe we should print some money from my apartment instead


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## Maz25 (Jul 6, 2008)

stevieboy1980 said:


> was only kidding about the last bit!!!!
> 
> maybe we should print some money from my apartment instead



Now, that's an idea! 

The reality is that most of those wonderful buildings we see in Dubai were being financed by Abu Dhabi and unfortunately for Dubai, Abu Dhabi has wisened up and decided to spend its own cash on its own projects. In a way, this might be best for the economy as it is usually the capital city that attracts more investment - something seems to have gone wrong with the UAE there in that Dubai was a lot more talked about than the actual capital of the UAE. In any case, the massive debts needs to be repaid before things improve in Dubai and lets all hope that things improve soon and the financial guru was right when he said that things should be on the up in 12 months.


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## stevieboy1980 (Sep 9, 2008)

yeah maz, my friends in construction in abu are loaded with work,qatar also.

i might go work with them hmmm


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## Gaza (Sep 22, 2008)

> In any case, the massive debts needs to be repaid before things improve in Dubai and lets all hope that things improve soon and the financial guru was right when he said that things should be on the up in 12 months.


Dubai has borrowed more than 100% of GDP to fund the projects. The Tories are apopletic today that Darling is proposing to raise UK Government borrowing to around 8% of GDP.

The point I was making is that if things start going wrong Dubai has no means to pay off the debt. You just have to look at the situation in Iceland to see the effects of excess. They have had to go cap in hand to the IMF. The forecast there is for inflation to rise to 23% and unemployment to 10%.

The Dubai Government will have to raise money. One way of doing that will be the introduction of personal taxation and one of the last major attrations of an ex-pat package will disappear.


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## stevieboy1980 (Sep 9, 2008)

yeah i heard about a possibility of taxation...

they will probably make a pint of lager from 5 pounds to 10!!!


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## dizzyizzy (Mar 30, 2008)

stevieboy1980 said:


> im in construction, so many jobs have been binned, on hold and alsorts, i am told just like this thread says, abu dabhi, will be no where to be seen.....
> many people are saying dubai is stuffed, but then look at other countries... where would we go, back to uk? no chance? anywhere else... pffft...
> The only country Im hearing that is starting to spend money NOW and big time is Qatar, my mate just got a job there and his salary is well put it this way, people would faint...
> 
> ...


see stevie, in times like this is when we need to boost the local economy BY SPENDING, that is why we took Becks to go shopping with us!!!


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## amaslam (Sep 25, 2008)

stevieboy1980 said:


> Our company reckon we have to bear with it, and slowly sail along for about 1 year, then it will settle down, but im not so sure...
> Why dont a country just print tons of money!!!


Because printing money would lead to hyperinflation. Germany tried that and you'd need a wheelbarrow full of money to buy a loaf of bread. 

I think it'll last more than a year, lots of people will lose their jobs and it's just going to suck for a while until the finance and banking picks up again. My guess good as yours, but I think 18 months minimum before things start looking anything like normal.


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## DXB-NY (Oct 6, 2008)

that is the part where everyone starts to run out of Dubai. 


Gaza said:


> Dubai has borrowed more than 100% of GDP to fund the projects. The Tories are apopletic today that Darling is proposing to raise UK Government borrowing to around 8% of GDP.
> 
> The point I was making is that if things start going wrong Dubai has no means to pay off the debt. You just have to look at the situation in Iceland to see the effects of excess. They have had to go cap in hand to the IMF. The forecast there is for inflation to rise to 23% and unemployment to 10%.
> 
> The Dubai Government will have to raise money. One way of doing that will be the introduction of *personal taxation *and one of the last major attrations of an ex-pat package will disappear.


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## Andy Capp (Oct 5, 2008)

Bonnington Land has cancelled developments on three of its plots at Jumeirah Village - http://www.business24-7.ae/Articles/2008/11/Pages/11242008_4f3fb9ab6190445fba5d17a1b3e04117.aspx

Omniyat Properties revamps strategies - http://www.business24-7.ae/Articles/2008/11/Pages/11252008_11f5866600ad4b9aa0142790225265ea.aspx

Dubai stocks drop as Abu Dhabi takes over mortgage lenders - Gulfnews: Dubai stocks drop as Abu Dhabi takes over mortgage lenders

Tameer axes half its workforce - Tameer axes half its workforce - Real Estate - ArabianBusiness.com

'Significant portion' of UAE projects to be shelved - 'Significant portion' of UAE projects to be shelved - Politics & Economics - ArabianBusiness.com

So there you go..... The developers can't loan the money, the money that the mugs, sorry intelligent investers paid on off-plans is worthless, and in the words of Private Frasier "We're all doomed, doomed I tell you".


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## greatexpectations (Aug 5, 2008)

taxation **gulps**

there is a damned if you do/don't thing going on though.

if Dubai start taxing, the economy will implode at a faster rate and expats will upsticks and relocate.

with the exception of the super-rich tax inc in the UK, all other taxes are coming down in a time of recession.


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## dizzyizzy (Mar 30, 2008)

well I reckon they will start with VAT apparently at 7% or so, in 2009? Heard it from an extremely reliable source but I forgot what % of VAT did she say!


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## DesertStranded (Oct 9, 2008)

dizzyizzy said:


> well I reckon they will start with VAT apparently at 7% or so, in 2009? Heard it from an extremely reliable source but I forgot what % of VAT did she say!




I read about VAT being introduced next year in Gulf News. I forget the percentage they said though. 7% would be a bit much. That's what VAT in my home state is and prices here for many things are already the same or more than back home after taxes. With taxation here that would make goods even more expensive than they are back home. I'm hoping the government will decide that's a bad idea since not paying taxes is why most westerners want to come here.


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## Gaza (Sep 22, 2008)

Andy Capp said:


> Bonnington Land has cancelled developments on three of its plots at Jumeirah Village - http://www.business24-7.ae/Articles/2008/11/Pages/11242008_4f3fb9ab6190445fba5d17a1b3e04117.aspx


My IT people are a bit unhappy with me this morning as I spat my coffee across my keyboard when I read the opening paragraph:-



> Bonnington Land has cancelled developments on three of its plots at Jumeirah Village *because of a shortage of electricity*, said a company executive.


 

Do they really expect anyone to believe this?


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## Andy Capp (Oct 5, 2008)

Yes Gaza, That was what made me pmsl....


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## grasshopper (Aug 12, 2008)

dizzyizzy said:


> well I reckon they will start with VAT apparently at 7% or so, in 2009? Heard it from an extremely reliable source but I forgot what % of VAT did she say!


I had heard quite consistently (no inside sources though!) that VAT was unlikely to occur before 2010. I guess they'll be keen now to hasten the schedule - but I doubt they'll be able to get all the collections and accounting systems in place for 2009.

If they introduce personal income tax - I'd rather go home where at least my tax dollars will pay for services and infrastructure rather than servicing Dubai's foolishly acquired debt!


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## Maz25 (Jul 6, 2008)

grasshopper said:


> I had heard quite consistently (no inside sources though!) that VAT was unlikely to occur before 2010. I guess they'll be keen now to hasten the schedule - but I doubt they'll be able to get all the collections and accounting systems in place for 2009.
> 
> If they introduce personal income tax - I'd rather go home where at least my tax dollars will pay for services and infrastructure rather than servicing Dubai's foolishly acquired debt!


I'd like to say the same but if I'm being realistic, my question would be, ''pay taxes on what''!! Most of us would go home and find ourselves unemployed, so really speaking we won't be paying any taxes and it would be someone else's sweat that you would be paying for our health care, etc! Sure, I don't want to pay taxes but considering everything that is happening around the world, I am counting my blessings - if you're getting taxed, that means you're still earning a salary! It could be worse!


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## dizzyizzy (Mar 30, 2008)

grasshopper said:


> I had heard quite consistently (no inside sources though!) that VAT was unlikely to occur before 2010. I guess they'll be keen now to hasten the schedule - but I doubt they'll be able to get all the collections and accounting systems in place for 2009.
> 
> If they introduce personal income tax - I'd rather go home where at least my tax dollars will pay for services and infrastructure rather than servicing Dubai's foolishly acquired debt!


yeah this person works for that monstrous multinational professional services firm that is in charge of the implementation of the project, and she did mention a time frame of 2009 but we all know that everything gets delayed in here anyway  so hopefully it won't happen any soon. 

I found this article at gulf news from back may and they talk about a 3-5% VAT rate.

Gulfnews: UAE could start VAT early next year


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## lisajoneseey (Oct 14, 2008)

Maz25 said:


> I'd like to say the same but if I'm being realistic, my question would be, ''pay taxes on what''!! *Most of us would go home and find ourselves unemployed*,
> 
> What a gloomy bunch . If your good at what you do and have the right attitude you will always find work. Im in construction, still based in the UK, and although the housing market has slowed down there is still plenty of infrastructure work to be done. Crossrail and the olympics will be keeping people busy in London for a while to come. Its also a fact that a good chunk of the recent government borrowing will be spent on infrastructure to boost the ecenomy. Therefore dont panic if you have to return home. Dubai may be sunny but England is still the best country in the world.
> 
> ...


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## alli (Mar 6, 2008)

lisajoneseey said:


> [England is still the best country in the world




lolololololol


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## Maz25 (Jul 6, 2008)

lisajoneseey said:


> Maz25 said:
> 
> 
> > I'd like to say the same but if I'm being realistic, my question would be, ''pay taxes on what''!! *Most of us would go home and find ourselves unemployed*,
> ...


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## lisajoneseey (Oct 14, 2008)

Maz25 said:


> lisajoneseey said:
> 
> 
> > Maybe if you came out here and found yourself in the same boat as the rest of us, where you do not even know whether you will have a job the next day, you'll probably realise that the 'gloomy bunch' are quite cheerful and are only trying to formulate plan B! I used to work in infrastructure in the UK and I've also worked on commercial towers, residential towers. The switch from building railway stations/tracks and airports to proper buildings - I could only describe it as a culture shock! From a QS point of view, these are 2 different things! The reality is that in construction and as a QS (as in my case!) you can only be good at certain things - it's impossible to have your fingers in every pie - the claims surveyor could never ever do the M&E surveyor's job!
> ...


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## Gaza (Sep 22, 2008)

lisajoneseey said:


> What a gloomy bunch . If your good at what you do and have the right attitude you will always find work.


Thank you for those words of wisdom.  

I had a job offer in Dubai that was pulled 10 days before I was due to fly out. It was a senior position paying AED 60,000 a month (equivalent to about £11k at current exchange rates). I now face the prospect of trying to find another job in the UK at a very difficult time. According to some recruitment consultants the job market is the worst they have known. So if I am a bit gloomy I think it is justified. I have a large mortgage and numerous other bills to pay. One glimmer of hope is I may be able to pick up a 6 month contract. However, the company are driving the package down as they are fully aware it is an employers market at the moment.


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## Falcon (Oct 4, 2008)

dizzyizzy said:


> yeah this person works for that monstrous multinational professional services firm that is in charge of the implementation of the project, and she did mention a time frame of 2009 but we all know that everything gets delayed in here anyway  so hopefully it won't happen any soon.
> 
> I found this article at gulf news from back may and they talk about a 3-5% VAT rate.



I cooperation with IMF and World Bank VAT will be introduced 2009 don t know the exactly figue. I belive Income Tax will follow soon.

Its just the beginning of a burst. in approx 6 months we will see how strong the damages are.

I read an article recently in financial times deutschland that the production crude in dubai is going down on max. 1000 barrel a day. Abu Dhabi is in a much better position with a capacity 35x more.

My Interviews are postphoned twice this month until Jan 2009.

I decided finally to stay where i am, and watch the coming desaster from the side line


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## Andy Capp (Oct 5, 2008)

Just got this e-mail....



> Dear Investors,
> 
> These are the best price per sq ft in Al Reem Island, Abu Dhabi. Ocean Pearl Tower, Great location- Surrounded by water on 3 sides! Original selling price was 2,045 AED per sq ft.
> 
> Selling price for cash deal only is 900 AED per sq ft!


So that's about 40% of recent value, and at cost....


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## zebedee (Oct 14, 2008)

i have been offered a position in dubai and am in the degree attestation process, i am very worried about my proposed new position. from what i have been reading on here it all sounds very very familiar to what i have been hearing in ireland about 6-9 months ago and ireland is way up sh!t creek with regards to the construction industry and the overall economy really.


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## Maz25 (Jul 6, 2008)

The unfortunate truth is that if you work in construction, there is absolutely nowhere to run, unless you want to brave it in Qatar (not recommended based on what I've been told - my colleague said he was going mental and his wife threatened him with divorce if he didn't get them out of there!)!


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## zebedee (Oct 14, 2008)

whats the deal with qatar? how do salaries compare with dubai?


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## Elphaba (Jan 24, 2008)

To obtain a realistic view of what is happening in the UAE, read The National. It is the best paper in the region (& employs some great freelancers  ). 

Property firms cut 600 jobs - The National Newspaper


This what is being admitted to, but there is much more to come...


-


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## Maz25 (Jul 6, 2008)

zebedee said:


> whats the deal with qatar? how do salaries compare with dubai?



Apparently, the salaries are so ridiculously high, your mates will go green in the face! However, you will have to sweat blood for every penny and suppossedly, the place is so dead that after a few weeks you will go mental! I love money but I love my sanity even more!


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## Dino100 (Jul 10, 2008)

Maz25 said:


> Now, that's an idea!
> 
> The reality is that most of those wonderful buildings we see in Dubai were being financed by Abu Dhabi and unfortunately for Dubai, Abu Dhabi has wisened up and decided to spend its own cash on its own projects. In a way, this might be best for the economy as it is usually the capital city that attracts more investment - something seems to have gone wrong with the UAE there in that Dubai was a lot more talked about than the actual capital of the UAE. In any case, the massive debts needs to be repaid before things improve in Dubai and lets all hope that things improve soon and the financial guru was right when he said that things should be on the up in 12 months.


Exhibit A: Sydney v Canberra
Exhibit b: NYC v D.C
Exhibit c: Mumbai v Dehli

The thing is, and we are all effected by scaremongering, why do we feel the need to perpetuate doom & gloom? Is it not enough that we are bombarded by the CNN, BBC and press every where you go!? I for one i am relieved when i pick up the Gulf News and they report on the positive side of things, dont get me wrong, i am not naive nor blinkered to what is going on, i work in Real Estate for heavens sake but frankly, we are all trying to get on with our lives in the best way we know how and trying to sap as much fun as we can from the meagre offerings. The start of this thread rang like a death knell and its point??? Well nothing that we haven't already learnt since Aug 07, i think perhaps i would rather read on this forum more topics about where shall we go this weekend to have a bit of fun or help those who still can mangage to to hawl their tabloid beaten carcasses to a seemingly better life then about the 4 winged "economists" of the Apolocalypse!!!

On that note, looking forward to the 7's this weekend!!!

Dino

(that wasn't aimed at you Miriam, your lovely)


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## zebedee (Oct 14, 2008)

Maz25 said:


> Apparently, the salaries are so ridiculously high, your mates will go green in the face! However, you will have to sweat blood for every penny and suppossedly, the place is so dead that after a few weeks you will go mental! I love money but I love my sanity even more!


i dont think sanity is all its cracked up to be, money on the other hand....ROCKS!!!


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## tango23 (Sep 26, 2008)

A bubble is a completely different thing to the normal business cycle. There is no comparison between bubbles and the normal business cycle.

To understand bubbles like the Holland's Tulip Bubble, England's South Sea Bubble, Scotland's Darien Project Bubble, or Dubai's Property Bubble, you have to understand the sheer madness of the herd mentality. Prices start going up for no other reason than the fact that they're going up. The thundering herd stops thinking and only reacts to itself.

Once the bubble has burst, as it has started happening a few months ago in Dubai, nothing can reflate it. There is no puncture repair kit for a burst asset price bubble. 

The Dubai economy is irrovacably imploding because it was just a puff economy which existed solely to support the construction industry which existed because of the puffing up of the bubble.


Would the last person to leave Dubai, please blow out the candle and close the door gently.

A friend of mine says .... What ever gas was left in the bubble - has now gone! R.I.P Dubai

... sad but horrific!

I dont feel any pleasure in saying all this and I am in no way eager or feeling happy to see Dubai economy going bad.


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## Andy Capp (Oct 5, 2008)

Tango,

This thread's a year old!


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## vincetruong (May 10, 2009)

*perspective from the National*



Elphaba said:


> To obtain a realistic view of what is happening in the UAE, read The National. It is the best paper in the region (& employs some great freelancers  ).
> 
> Property firms cut 600 jobs - The National Newspaper
> 
> ...


some perspective from said newspaper:
Markets edge back with eye on Dubai - The National Newspaper


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## stewart (Jun 21, 2009)

From one of my financial advisors.


>I was more than just somewhat embarrassed by this week-end's press - 
>the howling Schadenfreude over the mishaps in the Gulf were verging on 
>the shameful. The British press has always had a good line in petty 
>jealousy but as it is said that the bigger they are, the harder they 
>fall I am not surprised that the Sunday Times (so I am told) was 
>removed from the shelves across the UAE after some pretty direct 
>comments about Sheikh Muhammed ibn Rashid al Mahtoum. Yes, it is a 
>mess. Yes, the building boom was - very funneee, I know - built on 
>sand. Yes, it seems crazy trying to build a city state economic 
>powerhouse when the hinterland is populated by camels and scorpions. 
>But were these very same newspapers not quite recently admiring the 
>bold attempts by Dubai to create future for its people which looked 
>beyond the oil which it didn't even have? Weren't the property pages 
>full of fauning articles about how super it would be to invest in a 
>nifty holiday apartment in the Gulf and especially on the Jumeira Palm 
>or the World? The rich and the famous were buying there so it had be be 
>high on the list of must haves for the aspirational classes. Now, of a 
>sudden, when the debt mountain which funded these developents has 
>became too great for Dubai World and its Nakheel subsidiary to manage 
>everybody saw it coming and anyhow, it's only the comeuppance for a 
>bunch of overblown camel drivers, isn't it? Stop! First of all, Dubai 
>is not in default. It is one of seven Gulf States which form an 
>alliance known as the UAE. Abu Dhabi, the oil richest of the Emirates, 
>controls the purse strings and it will insure that Dubai as a sovereign 
>credit does not default. What happens to some of the government owned 
>corporate entities is a different matter altogether. Frankly, I think 
>the State of California credit is a lot more dodgy than that if the 
>Sheikhdom of Dubai and if I was offered the choice between the two I'd 
>take the latter all day long. No doub, a lot of money will be lost and 
>when some of the 1.2mm foreigners who work in Dubai come home 
>unemployed (I believe there are 120,000 from this country alone) there 
>will be a howling and wailing and nashing of teeth. I recall a Scottish 
>trades union leader some months back complaining that the insouciance 
>and greed of the RBS management was leading to thousands of this 
>members losing their jobs. I commented at the time that he had forgotten that had it not been of that greed and that insouciance which led to the explsive growth of RBS, his members wouldn't have had a job there in the first place.
>One thing appears clear, namely that there is no global systemic risk 
>from the Dubai situation - we are facing a corporate default like any other one.
>Enron, Worldcom. Parmalat - remember them? They failed with no assets 
>at all and in the case of the two former ones, recovery rates were 
>plus/minus zero. Nakheel is not the first property devloper to go belly 
>up but like all its predecessors it has had significant assets - 
>overvalued assets no doubt, but assets nevertheless. The Suez Canal 
>went bankrupt, so die the Channel Tunnel. There was nothing wrong with 
>either of those - other than they they were overloaded with debt and 
>once restructured and released from the cash drain of servicing that 
>debt, they went on to become highly successful companies. Just because 
>th owners wear a dishdasha instead of a Hugo Boss suit doesn't make 
>them bad people - incidentally, did you know that Hugo Boss did time 
>after the Nuremberg Trials for cooperation with the Nazi regime as 
>principal manufacturer of SS uniforms? - and I have no doubt that in 
>time the Dubai situation will, like many other commercial propery 
>markets, stabilze in time. Remarkably, there was a little article in 
>the WSJ on November 19th titled "A Sector too Tough to Save" which 
>looked at the US commercial real estate sector, the overvaluation of 
>assets and the risk to the banking sector. It contened that the 
>collapse in residential housing and the subsequent bail-out by 
>Washington had drained availible resources. If a full mark to market 
>were to be taken in the commercial sector and some of the unrealised 
>losses were to be booked there, the banking system would be at risk of 
>failing for a second time . Fact is, there is no benign Abu Dhabi there to prevent the worst........It looks like bargain hunting time in global markets.
>regards
>
> ----------------------------------------------------------------------
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## dizzyizzy (Mar 30, 2008)

stewart said:


> From one of my financial advisors.


That's brilliant  great post


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## dizzyizzy (Mar 30, 2008)

By the way, in 1994 Mexico went through a financial crisis (shocking, I know!) and the amount of the bailout was $120 billion USD!!... so what's $60 billion compared to that ??


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## stewart (Jun 21, 2009)

dizzyizzy said:


> By the way, in 1994 Mexico went through a financial crisis (shocking, I know!) and the amount of the bailout was $120 billion USD!!... so what's $60 billion compared to that ??


Only a grain of sand amongst the boulders


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## marc (Mar 10, 2008)

I'm still happy here and do plenty of business - and yes I'm in Real Estate (OMGOMGMGMOMG). 

Everything recovers in the end simple as that.... people are just need to come round to the fact that they are not making money in 1-6 months and need to look at the longer side of things.

Good thing about ready property is that it will always have a value, unlike stocks. 

I will end with a few quotes which I like.

''Corporations can get sick and die, Real Estate can get sick but it will never die”

''Be fearful when others are greedy and be greedy when others are fearful''

''Get rich or die trying''

'' When theres blood on the streets, buy a property''


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## stewart (Jun 21, 2009)

marc said:


> I'm still happy here and do plenty of business - and yes I'm in Real Estate (OMGOMGMGMOMG).
> 
> Everything recovers in the end simple as that.... people are just need to come round to the fact that they are not making money in 1-6 months and need to look at the longer side of things.
> 
> ...


As long as I can enjoy life I am Happy.
I am still making a profit so with tomorrow off it's off to the bar for me!


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## merlin the learned (Jun 12, 2009)

Gaza said:


> Is the Dubai economic bubble about to burst? From where I am sitting it certainly has developed a big leak!
> 
> 
> I agree with everything you have stated and tried to warn people on the risks of investing in Dubai. My work takes me behind the screens where 90% of expats never go giving me an insight into the true state of affairs.
> ...


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## Elphaba (Jan 24, 2008)

Oh please. Anyone who has been in Dubai for some time has been aware of the financial difficulties the government were facing.

-


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## Iron Horse (Apr 10, 2008)

Elphaba said:


> Oh please. Anyone who has been in Dubai for some time has been aware of the financial difficulties the government were facing.
> 
> -


Exactly. I don't understand why people are reacting this way now when we've seen this since December of 2008. The only shock is the public acknowledgment of the situation.


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## reasonant (Dec 2, 2009)

My first post here. Interesting to note each of yours viewpoint. It seems however that IMF's position with regards to Dubai is clarified in their statement today. They have stated that Dubai World’s attempt to delay debt repayments, while slowing growth in the United Arab Emirates, is “contained and manageable”.

I'm unable to post links until I become an active member


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## merlin the learned (Jun 12, 2009)

Elphaba said:


> Oh please. Anyone who has been in Dubai for some time has been aware of the financial difficulties the government were facing.
> 
> -


I would suggest a few less posts allowing yourself time to consider a reply of more substance would be in order


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## Elphaba (Jan 24, 2008)

merlin the learned said:


> I would suggest a few less posts allowing yourself time to consider a reply of more substance would be in order


I suggest you consider anything that you post if you wish to continue to do so. 

There is no obligation on anybody to respond to anythng you say. It's just a shame you don't like people pointing out the banality of your posts.

-


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## mrbig (Sep 10, 2009)

Merlin the turd, Elphaba is the wrong person to argue with concerning dubai, economy, and finacial doings. But if you still want to then by all means, look like a turd.


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## marc (Mar 10, 2008)

Merlin the c*** hahahaha LMAO.


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## stewart (Jun 21, 2009)

HAHA Merlin tried to take on the wrong person to have a crack at this time.
Should not pick on moderator's mate.
If you are going to make it constructive comments not bulls**t, you stand a chance that way.


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## Elphaba (Jan 24, 2008)

stewart said:


> HAHA Merlin tried to take on the wrong person to have a crack at this time.
> Should not pick on moderator's mate.
> If you are going to make it constructive comments not bulls**t, you stand a chance that way.


Moderator's mate? I was the first moderator on the Dubai forum. 

:mod:

-


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## marc (Mar 10, 2008)

Elphaba said:


> Moderator's mate? I was the first moderator on the Dubai forum.
> 
> :mod:
> 
> -



I think he meant, 

You should not pick on moderators. mate.


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## siobhanwf (Mar 20, 2009)

stevieboy1980 said:


> Why dont a country just print tons of money!!!


That's what Germany did between the two World Wars!!! and look where th at got them.

Do you also want to be like Zimbabwe?? where they have done exactly that!


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## jojo (Sep 20, 2007)

siobhanwf said:


> That's what Germany did between the two World Wars!!! and look where th at got them.
> 
> Do you also want to be like Zimbabwe?? where they have done exactly that!



They're doing a bit of that in the UK!!! It just devalues the currency and causes inflation

Jo xxx


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## mrbig (Sep 10, 2009)

they are doing a lot of it in america. obama the idiot


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## siobhanwf (Mar 20, 2009)

jojo said:


> They're doing a bit of that in the UK!!! It just devalues the currency and causes inflation
> 
> Jo xxx


I think they are working hard to get the pouns sterling on a level footing with the euro and the HEY PRESTO the UK is in the euro zone!!


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## vincetruong (May 10, 2009)

"Printing money" or monetizing debt won't cause inflation until the actual velocity at which money changes hands begins to increase . . . i.e. banks must be willing to lend the cheap money that central banks are making available in order to stoke commerce which will then lead to inflation. that is still a slow moving process right now. Devaluation of currency is not solely a function of printing money if the money is not being circulated by the banks. 

The value of a currency is not solely determined by a central bank's monetary policy. Fiscal policy, what a country's treasury dept or respective equivalent, intends for their currency also comes into play. For instance, during the past decade, the Bush administration had a weak dollar policy in hopes of making US exports more competitive and leveling the trade deficit. Brazil recently has imposed taxes on foreign investors into their stock exchange because the purchase of Brazilian equities by foreigners was driving up their currency. Placing a tax on foreign investors was a fiscal act to control the value of their currency.


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## siobhanwf (Mar 20, 2009)

Iron Horse said:


> Exactly. I don't understand why people are reacting this way now when we've seen this since December of 2008. The only shock is the public acknowledgment of the situation.



Very true. It's just that now someone has put an "official" seal on it.

We were last there in February and it was very apparent then.


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## marc (Mar 10, 2008)

''Quantitative Easing'' is the correct term, playing with fire is the other !!!


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## Andy Capp (Oct 5, 2008)

Dubai going bust?

Not according to yesterday's sun....

Brits defy Dubai debt crisis as they sip champers in 25°c december sun | The Sun |Features

Anyone know anyone that was mentioned....


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## Elphaba (Jan 24, 2008)

Andy Capp said:


> Dubai going bust?
> 
> Not according to yesterday's sun....
> 
> ...


Dear god, no! There are resons why we call it Bar-Nasty - because it is full of wannabes and wideboys. 

-


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## Andy Capp (Oct 5, 2008)

Elphaba said:


> Dear god, no! There are resons why we call it Bar-Nasty - because it is full of wannabes and wideboys.
> 
> -


And I completely agree with you - It also happens to be the ex's favourite hang out (with new husband!)


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## jhbsnoopy (May 20, 2009)

even I experience the crisis, I lost my job during recession period and now i got a new job but lower salary but at least now we know how to handle our money wisely. Reduce shopping and using credit cards...


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## Iron Horse (Apr 10, 2008)

mrbig said:


> they are doing a lot of it in america. obama the idiot


Ahh Mr. Small. Inherits a mess from junior and then is blamed for the mess. This actually goes all the way back to Reagan and his whack out view with voodoo economics.


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## Iron Horse (Apr 10, 2008)

Andy Capp said:


> Dubai going bust?
> 
> Not according to yesterday's sun....
> 
> ...


The high end Barasti Bar??? The bars are still packed? I was at Barasti not too long ago and the place wasn't as packed as I've seen it before when times were better here. 

Yeah it must be The Sun writing such drivel as that. They also coined this cover a few days ago, while funny it's completely false.

http://theoriginalwinger.com/wp-content/uploads/2009/12/sunworldcupcover.jpg


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## mrbig (Sep 10, 2009)

Iron Horse said:


> Ahh Mr. Small. Inherits a mess from junior and then is blamed for the mess. This actually goes all the way back to Reagan and his whack out view with voodoo economics.


ok obama sack rider, what has obama done that he promised he would do? nothing. all he has done is almost triple our national debt and won a nobel prize. the nobel prize is now a joke because of him. And now he has the lowest ratings ever after the first year of any president. so its not just me who thinks he is an idiot. get a clue fellow american.


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## stewart (Jun 21, 2009)

Here is another link you might be interested in.
Actually I am over this topic, last time I am looking at this thread!
Phoenix officials confident Dubai will recover


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## stewart (Jun 21, 2009)

Andy Capp said:


> And I completely agree with you - It also happens to be the ex's favourite hang out (with new husband!)


Yep it is the lower end of places I want to drink at.
Only the dregs go there cause they dont know the better places.


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## Iron Horse (Apr 10, 2008)

mrbig said:


> ok obama sack rider, what has obama done that he promised he would do? nothing. all he has done is almost triple our national debt and won a nobel prize. the nobel prize is now a joke because of him. And now he has the lowest ratings ever after the first year of any president. so its not just me who thinks he is an idiot. get a clue fellow american.


Sack rider? Spare me your phallic state of mind. Has he increased the debt? Yes, but it was something that had to be done to keep things from a total downward spiral created by eight years of junior's policies. However, if the debt issue is going to be your battle cry, then you need to blame Reagan to start. Chances are you probably think he's as wonderful as sliced bread. I'll suggest two books for you to read as they should explain a lot. _The Post-American World_ by Fareed Zakaria and _Unequal Democracy: The Political Economy of the New Gilded Age_ by Larry M. Bartels. The first will deal with a general overview of why the US is in the position it's in and the second will give actual numbers as to democratic versus republican administrations showing why democratic administrations are better and what typically happens for a US President's first year in office. What would you like to see him do and why?

As for the Nobel Prize issue, this is a wonderful red herring, but I'll bite anyway. Why does his winning it make it a joke? I'll give you that it was premature, but by now you've probably heard the explanation as to why he was awarded The Nobel Peace Prize. Why does this kind of award mean so much to you? Who should have received it in place of Obama?

Have you asked yourself why his ratings are low? I suspect it is because Americans have grown frustrated, impatient, and greedy with wanting returns on their investments (i.e. their vote). The US has many voters that focus on single issues, such as ending a war, the economy, abortion, deficit spending, or health care. Typically if they don't get their issue taken care of first, no matter which political party they identify with, they will answer phone surveys negatively resulting in low poll numbers. I'm sure none of the actual honest surveys asks if they think Obama is an idiot, so please go back and rethink your argument rather than using the Rush Limbaugh/Glenn Beck method of red herrings, fear mongering, and irrational issues to prove a point.

While I'm not the worlds best writer please do yourself a favor and take a writing class and learn punctuation.


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## mrbig (Sep 10, 2009)

lol, puncuation nazi. 
Well you didnt mention one thing that Obama has done in his 1 year that he said he was going to do. Die hard Democrat, to bad your boy wont be in office next term. Just wish the Republicans had somone who was worth a ****.

Glen Beck is a total badass, he says what everyone else is to scared to say.


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## stewart (Jun 21, 2009)

Ah politics!!!
The topic will start an argument every time in any country.
You have to love it.


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## Iron Horse (Apr 10, 2008)

mrbig said:


> lol, puncuation nazi.
> Well you didnt mention one thing that Obama has done in his 1 year that he said he was going to do. Die hard Democrat, to bad your boy wont be in office next term. Just wish the Republicans had somone who was worth a ****.
> 
> Glen Beck is a total badass, he says what everyone else is to scared to say.


You also failed to answer any questions posed to you, but I'll play along.

Here is what he has done: He said he would most likely have to increase troops in Afghanistan, check. He would work on health care and getting this out of control situation resolved, check. Signed a stimulus plan that saved the US from a total meltdown, check. He's working on getting the war in Iraq to come to a close. He's managed to get the US a somewhat favorable worldwide view among other countries. What should he have accomplished in the meantime? What things would John McCain have accomplished in this short period of time?

What you have done in the process is prove my point about how impatient and frustrated Americans have become. You want that instant gratification, but aren't willing to do the sacrifice yourself because it's always somebody else who needs to pony up. The best you can do is resort to name calling/ad hominem attacks here with no substance to show.

What you have also shown here is your racist undertones with the reference to Obama as "boy" (for those who don't understand this was a term the white southerners in the US would use for the blacks). You'll most likely play this one down as saying because I am with him he is on mine side or some other nonsense.

Yeah, Glenn Beck is a total tool, and the fact you can't even spell his name correctly says a lot. Now we know who likes to be spoon fed via Faux News. Just get ready for a second Obama term because it will happen.

Be a peach and answer questions posed to you.

As for the economic bubble, it's just going to take time so people can't be impatient or greedy in the meantime.


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## Iron Horse (Apr 10, 2008)

stewart said:


> Ah politics!!!
> The topic will start an argument every time in any country.
> You have to love it.


Can't say I really love it, as I'm more into truth and justice, rather than ranting and raving muppets who can only repeat what their "news" people feed them.


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## mrbig (Sep 10, 2009)

He said he would decrease troops and end the war.
All he has done on healthcare is create a giant cluster****.
Yeah great stim plan, about half of it went to stupid **** like tanning salons, global warming, people who donated to him during his election ect... just check drudgreport there was a great article on it yesterday, and glenn beck has covered that as well.
working on getting the iraq war to a close????? yeah he is just sending them all to afganistan.

racial overtones? go back a couple of posts and you were calling Bush my boy so I was just returning the favour. And the way you spelled his name is very racial. Its what the people from the north think all southern people sound like when we speak and spell. You sir are a Bigot. All democrats with thier back against the wall will pull the race card. what a dolt.

Now if you want to speak with me further I will be more than happy to have a cup of joe with you somwhere. Just name the place mate. I will be there. Heck I will even pay, gotta do the democratic thing and take care of poor people right?


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## stewart (Jun 21, 2009)

For the sceptics see gulf news today.

http://http://gulfnews.com/business/economy/nakheel-bond-paid-in-full-1.553344


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## Iron Horse (Apr 10, 2008)

mrbig said:


> He said he would decrease troops and end the war.
> All he has done on healthcare is create a giant cluster****.
> Yeah great stim plan, about half of it went to stupid **** like tanning salons, global warming, people who donated to him during his election ect... just check drudgreport there was a great article on it yesterday, and glenn beck has covered that as well.
> working on getting the iraq war to a close????? yeah he is just sending them all to afganistan.
> ...


Just as you asked before, where were the answers to the questions posed to you? You expect him to do everything in such a short amount of time?
Check your sources again and stop being such a parrot of guys who are slanted in their views. He's always said he would have to increase troops in Afghanistan. What should he have sent to Afghanistan? Wall Street traders? The troops had to come from somewhere, so whether they are out of Iraq or the US it's still one unfortunate situation we are in. You think he was just going to up and pull everyone out overnight?

I'm baffled by your expectations for his first year. You must also be upset with republican administrations that help out those who donate to their campaigns? Because I'll gladly stand with you against those who get benefits for donating to elected officials.

Glenn Beck is an entertainer as he has admitted to, so his credibility is in question because he'll continue to spoon feed crap to those who want to hear this sort of nonsense.

Yes, racial overtones. I'm not from the north, nor did I say you were from the south, just that it was a term used by southerners back in the day. Yes, I'm a bigot towards the muppets of the world I'll admit it. It's difficult to stomach the vile crap they spew. Even Michael Steele had to ask an MSNBC reporter about a "You People" question awhile back, so my interpretation still stands. There was nothing racial about calling Bush "junior", it's called an insult.

My back against the wall? I don't know how you come to that conclusion, but you keep grasping for those straws.

How can he have created a mess on healthcare when the bill is still sitting in the House and Senate? Are you saying that the current system isn't a mess right now?

I do not believe you're sincere in the interest in meeting to discuss anything as you then proceed to insinuate that you are so nice you'll even pay because you are going to "take care of the poor people"(me). Go drink your coffee and read one of the books I mentioned before. Chances are I think you will be more inclined to continually drink the Kool-Aid and watch Fake News.


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## Thom (Dec 17, 2009)

Abu Dhabi will still be there to pay Dubai debt...in 5 year dubai world and the other big companies will be the property of AD


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