Dubai Defaults-Markets tanking-

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Shania Twain's picture
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Joined: 2009-09-23

breaks my heart.

mel et al:
All u bears can get all excited.

(buy the opening)

It followed months of positive moves and comments from government officials suggesting Dubai and the federal government of the United Arab Emirates were willing to step in to plug financing holes.

Sheikh Mohammed Bin Rashid Al Maktoum, Dubai's ruler, said in a speech to investors this month that "the worst is over and Dubai is now well-placed; the global economic crisis, despite its impact, will not deter Dubai's ambitions".

(cant trust these #*#@**)

Markets crash on Dubai default fears

AGENCIES 27 November 2009, 01:42am ISTText Size:|Topics:Dubai
Market

Dubai is shaking investor confidence across the Persian Gulf after it sought a six-month reprieve on debt payments that risked triggering the

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biggest sovereign default since Argentina in 2001. The move caused a drop on world markets on Thursday and raised questions about Dubai's reputation as a magnet for international investment.

In Europe, the FTSE 100, Germany's DAX and the CAC-40 in France opened sharply lower. Earlier in Asia, the Shanghai index sank 119 points, or 3.6%, in the biggest one-day fall since August 31. Hong Kong's Hang Seng shed 1.8%. Wall Street was closed for the Thanksgiving holiday and most markets in the Middle East were silent because of a major Islamic feast.

Stocks, bonds and currencies fell across developing countries. The MSCI Emerging Markets Index of stocks dropped 1.1%, led by declines in China and Russia.

The fallout came swiftly after Wednesday's statement that Dubai's main development engine, Dubai World, would ask creditors for a standstill on paying back its $60 billion debt until at least May. The company's real estate arm, Nakheel -- whose projects include the palm-shaped island in the Gulf -- shoulders the bulk of money due to banks, investment houses and outside development contractors.

In total, the state-backed networks nicknamed Dubai Inc are $80 billion in the red and the emirate needed a bailout earlier this year from its oil-rich neighbour Abu Dhabi, the capital of the United Arab Emirates.

``Nakheel is now standing on the brink of failure given the astonishing amount of cash Dubai would have to inject into it in order to see the enterprise survive,'' said Luis Costa, emerging-market debt strategist at Commerzbank AG in London. ``Events like this are a perfect storm.''

``Dubai's standstill announcement ... was vague and it remains difficult to discern whether the call for a standstill will be voluntary,'' said a statement from the Eurasia Group, a Washington-based research group that assesses political and financial risk for foreign investors interested in Dubai. ``If it is not, Dubai World will be going into default and that will have more serious negative repercussions for Dubai's sovereign debt, Dubai World and market confidence in the UAE in general,'' the statement added.

``There is nothing investors dislike more than this kind of event,'' said Norval Loftus, the head of convertible bonds and Islamic debt at Matrix Group Ltd. in London, which manages $2.5 billion of assets including Dubai credits. ``The worst-case scenario will of course be involuntary restructuring on the Nakheel security that brings into question the entire nature of the sovereign support for various borrowers in the region.''

Moodys Investors Service and Standard & Poor's cut the ratings on state companies yesterday, saying they may consider state-controlled Dubai World's plan to delay debt payments a default. The sheikhdom, ruled by Sheikh Mohammed Bin Rashid Al Maktoum, borrowed $80 billion in a four-year construction boom that reduced its reliance on falling oil supplies and created the region's tourism and financial hub.

``Dubai is the most indicative of the huge global liquidity boom and now in the aftermath there will be further defaults to come in emerging markets and globally,'' said Nick Chamie, head of emerging-market research at Toronto-based RBC Capital Markets.

``It's very important to resolve this in a way that will minimize contagion across the region,'' Matrix Groups Loftus said. The moot question is whether that will be possible.

amfUBS's picture
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Idiot ragheads. With vast stretches of terra firma, they're building islands so that every pilgrim gets his own boat slip. How could all of this possibly go wrong? Wait until all of Al Gore's glaciers melt, Venice in Arabia.

BerkshireBull's picture
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f***in camel-jockeys go from this in 1990:To this:In 19 years and can't pay their bills now.What fools loaned these towelheads money?

Northfield's picture
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Buy the dip.

NYCTrader's picture
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Joined: 2009-11-20

Hey assholes -- the good old US of A recently went through a similar crash.  Remember, it was way back in 2008.  Our dumbf*** banks, hedge funds and VC firms helped fund this mess. Please buy on the dips.  I'll need someone to take the other side of my shorts.

Shania Twain's picture
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NYCTrader wrote:Hey assholes -- the good old US of A recently went through a similar crash.  Remember, it was way back in 2008.  Our dumbf*** banks, hedge funds and VC firms helped fund this mess. Please buy on the dips.  I'll need someone to take the other side of my shorts.
 
cover.  reverse long. 
you wont much of a chance
 
its 50 bil.   big deal

NYCTrader's picture
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Shania Twain wrote:NYCTrader wrote:Hey assholes -- the good old US of A recently went through a similar crash.  Remember, it was way back in 2008.  Our dumbf*** banks, hedge funds and VC firms helped fund this mess. Please buy on the dips.  I'll need someone to take the other side of my shorts.
 
cover.  reverse long. 
you wont much of a chance
 
its 50 bil.   big dealIt's actually $80 billion.  For someone whose entire bullish case is based on the emerging middle class of BRIC nations, I would be VERY concerned: Nov. 27 (Bloomberg) -- Dubai’s debt woes may worsen to
become a “major sovereign default” that roils developing
nations and cuts off capital flows to emerging markets, Bank of
America Corp. said.
“One cannot rule out -- as a tail risk -- a case where
this would escalate into a major sovereign default problem,
which would then resonate across global emerging markets in the
same way that Argentina did in the early 2000s or Russia in the
late 1990s,” Bank of America strategists Benoit Anne and Daniel
Tenengauzer
wrote in a report.
A default would lead to a “sudden stop of capital flows
into emerging markets” and be a “major step back” in the
recovery from the global financial crisis, they wrote.
Emerging-market stocks around the world have slumped for
two days on concern a debt restructuring by Dubai World, with
$59 billion of liabilities, will add to the $1.72 trillion of
losses and writedowns from the global credit freeze. The MSCI
Emerging Markets Index
fell 1.8 percent to 940.58 as of 12:34
p.m. in New York, extending this week’s decline to 2.5 percent,
the biggest in a month.
Steepest Property Slump
Dubai, which borrowed $80 billion in a four-year
construction boom to transform its economy into a tourism and
financial hub, suffered the world’s steepest property slump in
the recession. Home prices fell 50 percent from their 2008 peak,
according to Frankfurt-based Deutsche Bank AG.
“In a best-case scenario, this will remain limited to a
Dubai corporate sector problem, with either some bailout from
UAE authorities or a market-friendly debt restructuring,” they
wrote.

South Korea’s won lost 1.7 percent, the biggest slump among
25 emerging-market currencies, followed by the Philippine peso.
The extra yield investors demand to own developing nations’
bonds instead of U.S. Treasuries jumped the most in a month,
rising 14 basis points to 3.24 percentage points, according to
JPMorgan Chase & Co.’s EMBI+ Index.
Dubai’s state-owned companies’ credits were downgraded by
Fitch Ratings today, and by Moody’s Investors Service and
Standard & Poor’s on Wednesday on concern the government’s
ability to support lenders will be constrained after Dubai’s
attempt to delay debt repayments.

Shania Twain's picture
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Joined: 2009-09-23

keep shorting it
hold cash
buy govies

Gaddock's picture
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Joined: 2007-02-23

Made for an awesome tradable move on a day that is called amateur hour. I unwound a few on the open and put them back on at lunch. Great day!
 

Thanks to our sandy friends & Ameritrade!!!

Anonymous's picture
Anonymous

JP Morgan: Stop Freaking Out, The UAE Can Easily Save Dubai

troll's picture
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mlgone wrote:JP Morgan: Stop Freaking Out, The UAE Can Easily Save Dubai
 
No one can SAVE anyone, stupid little boy

Anonymous's picture
Anonymous

show me that awesome portfolio again gay boy

Anonymous's picture
Anonymous

Gaddock wrote:Made for an awesome tradable move on a day that is called amateur hour. I unwound a few on the open and put them back on at lunch. Great day!
 

Thanks to our sandy friends & Ameritrade!!!
What did you unwind and put back on??

Gaddock's picture
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Joined: 2007-02-23

A couple reverse conversions. If you look at the emini's and use pivot points to get good fills open only orders were great as well. The futures tanked on the low volume amateur hour and then headed right back up. I took advantage of it. The day after Thanksgiving is one of the funniest days of the year, the do it yourselfers get fleeced!
 
 
Bwaaa ha ha ha

troll's picture
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Gaddock wrote:A couple reverse conversions. If you look at the emini's and use pivot points to get good fills open only orders were great as well. The futures tanked on the low volume amateur hour and then headed right back up. I took advantage of it. The day after Thanksgiving is one of the funniest days of the year.
 
Close, this is almost a garaunteed up day. Short covering saved the market from a crash as well as not many players. ( Wait a minute.......half a market day and volume higher than Wednesday and very close to the rest of the week ) Your probably right though, who cares about facts, no one cared today. Hell it's the day after Thanksgiving, f*** the BILLION dollars I have on the line!

Gaddock's picture
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The only "fact" that matters is the perception of the masses and it's effect on the market. The rest is mental masturbation at best, cheap ego at worst.
 
This game is not about being right or bragging rights, it's about MAKING MONEY!!
 
IMHO that is.

Shania Twain's picture
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Joined: 2009-09-23

Gaddock wrote: The only "fact" that matters is the perception of the masses and it's effect on the market. The rest is mental masturbation at best, cheap ego at worst.
 
This game is not about being right or bragging rights, it's about MAKING MONEY!!
 
IMHO that is.

amen brother.

on our team, if someone starts with the BS Jedi crap...

stfu......

be right.

troll's picture
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Joined: 2004-11-29

Gaddock wrote:The only "fact" that matters is the perception of the masses and it's effect on the market. The rest is mental masturbation at best, cheap ego at worst.
 
This game is not about being right or bragging rights, it's about MAKING MONEY!!
 
IMHO that is.
 
AGREE

Shania Twain's picture
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Joined: 2009-09-23

howboutshoeshine wrote:

garaunteed

dude, i cant spell worth sh*t

but, come on   garaunteed?

double dip's picture
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Joined: 2009-11-28

Twain,

You're posting at 6:30 on a Saturday morning ? Looks like you a little worried about the correction Monday

Anonymous's picture
Anonymous

Shania Twain wrote: howboutshoeshine wrote:

garaunteed

dude, i cant spell worth sh*t

but, come on   garaunteed?

That is bad

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