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SHUAA SEES BUYOUT OPPORTUNITIES (Dubai)

Posted by Gilmour Poincaree on January 20, 2009

January 19, 2009, 23:09

Bloomberg

PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

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PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

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Posted in BANKING SYSTEMS, DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, INTERNATIONAL, ISLAMIC BANKS, RECESSION, RESTRUCTURING OF PRIVATE COMPANIES, THE FLOW OF INVESTMENTS | Leave a Comment »

CASH CRUNCH PUSHES DUBAI BUSINESSMAN TO COMMIT SUICIDE

Posted by Gilmour Poincaree on January 16, 2009

Friday 9 January 2009 (12 Muharram 1430)

by Shadiah Abdullah – Arab News

PUBLISHED BY ‘ARAB NEWS’ (Saudi Arabia)

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PUBLISHED BY ‘ARAB NEWS’ (Saudi Arabia)

Posted in BANKING SYSTEMS, DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, INTERNATIONAL, RECESSION | Leave a Comment »

DUBAI CRACKS DOWN ON ANIMAL SMUGGLERS

Posted by Gilmour Poincaree on January 16, 2009

Thursday 15 January 2009 (18 Muharram 1430)

by K.T. Abdurabb – Arab News

PUBLISHED BY ‘ARAB NEWS’ (Saudi Arabia)

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PUBLISHED BY ‘ARAB NEWS’ (Saudi Arabia)

Posted in COMMERCE, COMMODITIES MARKET, CRIMINAL ACTIVITIES, DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, ENVIRONMENT, FINANCIAL CRISIS 2008/2009, INTERNATIONAL, JUDICIARY SYSTEMS, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY | Leave a Comment »

TELECOM FIRM SET TO INVEST $1BN IN IRAN – EMIRATES TELECOMMUNICATIONS CORPORATION (ETISALAT) YESTERDAY SAID A CONSORTIUM IT HEADS WILL INVEST AT LEAST $1 BILLION IN A MOBILE PHONE NETWORK IN IRAN

Posted by Gilmour Poincaree on January 14, 2009

Vol XXXI – N° 300 – Wednesday 14th JANUARY 2009

Gulf Daily News

PUBLISHED BY ‘THE GULF DAILY NEWS’ (Dubai)

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PUBLISHED BY ‘THE GULF DAILY NEWS’ (Dubai)

Posted in COMMERCE, COMMODITIES MARKET, COMMUNICATION INDUSTRIES, DIGITAL INDUSTRIES, DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, ELECTRIC / ELECTRONIC INDUSTRIES, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, FOREIGN POLICIES, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, IRAN, PUBLIC SECTOR AND STATE OWNED ENTERPRISES, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RESTRUCTURING OF THE PUBLIC SECTOR, THE FLOW OF INVESTMENTS | Leave a Comment »

DEPRESSED PAKISTANI SEVERS HEAD WITH ELECTRIC SAW – DUBAI: A PAKISTANI BUSINESSMAN, DEPRESSED BY THE IMPACT OF THE ECONOMIC CRISIS, KILLED HIMSELF WITH AN ELECTRIC SAW BY ALMOST SEVERING HIS HEAD AT HIS SHARJAH HOME, AL-ITTIHAD NEWSPAPER SAID ON FRIDAY

Posted by Gilmour Poincaree on January 11, 2009

Friday, 09 Jan, 2009 – 04:30 PM PST

As reported by Agence France-Presse

PUBLISHED BY ‘DAWN’ (Pakistan)

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PUBLISHED BY ‘DAWN’ (Pakistan)

Posted in BANKING SYSTEMS, DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, INTERNATIONAL, PAKISTAN, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RESTRUCTURING OF PRIVATE COMPANIES, THE FLOW OF INVESTMENTS | Leave a Comment »

ISRAEL WILL BE AT THE RECEIVING END

Posted by Gilmour Poincaree on January 9, 2009

January 08, 2009, 23:38

by Patrick Seale – Special to Gulf News

PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

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PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

Posted in BANKING SYSTEM - USA, BANKRUPTCIES - USA, COMMERCE, COMMODITIES MARKET, CRIMINAL ACTIVITIES, DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FOREIGN POLICIES, FOREIGN POLICIES - USA, HATE MONGERING AND BIGOTRY, HUMAN RIGHTS, INDUSTRIAL PRODUCTION, INDUSTRIAL PRODUCTION - USA, INDUSTRIES, INDUSTRIES - USA, INTERNATIONAL, INTERNATIONAL RELATIONS, MILITARY CONTRACTS, RECESSION, THE ARMS INDUSTRY, THE FLOW OF INVESTMENTS, THE ISRAELI-PALESTINIAN STRUGGLE, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE UNITED NATIONS, USA, WARS AND ARMED CONFLICTS, WEAPONS | Leave a Comment »

BORN TO BE FREE

Posted by Gilmour Poincaree on January 9, 2009

January 08, 2009, 23:38

by Mehmudah Rahman – Dubai-based Freelance-writer

PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

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PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

Posted in COMMERCE, COMMODITIES MARKET, DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FOOD PRODUCTION (human), INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, POULTRY, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, THE FLOW OF INVESTMENTS | Leave a Comment »

BORSE DUBAI PIONEERS FINANCING REVIVAL

Posted by Gilmour Poincaree on January 9, 2009

January 08, 2009, 23:38

Bloomberg

PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

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PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

Posted in BANKING SYSTEMS, CENTRAL BANKS, DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, INTERNATIONAL, RECESSION, STOCK MARKETS, THE FLOW OF INVESTMENTS | Leave a Comment »

UAE MARKETS EXTEND GAINS FROM PREVIOUS SESSION, CLOSE HIGHER

Posted by Gilmour Poincaree on December 31, 2008

December 30, 2008, 15:22

Agencies

PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

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PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

Posted in DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, INTERNATIONAL, RECESSION, STOCK MARKETS, THE FLOW OF INVESTMENTS, UNITED ARAB EMIRATES | Leave a Comment »

LET’S PACK AND HAVE DINNER IN DUBAI – Suddenly jobless? Dubai hotel offers a free meal

Posted by Gilmour Poincaree on December 13, 2008

December 12, 2008

by Adam Schreck

PUBLISHED BY ‘THE DAILY STAR’ (Egypt)

DUBAI: Dubai isn’t known for soup lines. But at least one hotel in the glitzy tourist spot is offering visitors left jobless by the economic slump a free meal anyway.

All unemployed dinner-seekers have to do is show up with their layoff letter in hand. And yes, the offer applies to out-of-towners willing to make the trip to the Gulf Arab sheikdom.

“A lot of people are finding themselves in a very difficult situation right now,” said Mark Lee, general manager of the Arabian Park Hotel, which is offering the meals. “Being made redundant at this time of year is no fun at all, and we’re trying to give a little bit of festive cheer back.”

The offer comes as Dubai, a fast-growing but debt-heavy city of new skyscrapers, grapples with its first mass layoffs in years.

Several property developers — the most visible employers in town — have laid off hundreds of employees in recent weeks.

State-owned Nakheel, the builder of palm-shaped islands off the coast, recently said it was shedding 500 jobs, or 15 percent of its work force. Others say they’re re-examining staffing levels and aren’t ruling out job cuts.

On Thursday, Shuaa Capital, a publicly traded investment company based in Dubai, said it had begun laying off 21 employees, or 9 percent of its Dubai-based staff.

The cutbacks are sowing fear among the tens of thousands of foreign workers who have moved to the city to take advantage of its largely tax-free construction, financial and tourism boom.

Many of the better off have bought property whose value is now falling, and most expatriates rely on continued employment to ensure their residency permits remain valid. Among the most vulnerable are the relatively low-paid unskilled laborers from South Asia who make up most of the city-state’s population.

Arabian Park’s free-meal offer isn’t entirely altruistic. In addition to helping others, the hotel hopes to entice more guests, Lee said.

Dubai’s tourism sector, a key piece of the city’s ambitious growth plans, is under increasing pressure from a strengthening dollar — which makes travel from Europe more expensive — and an economic slump that is convincing consumers to avoid exotic holiday trips.

Alex Kyriakidis, who heads the global tourism, hospitality and leisure division at professional services firm Deloitte & Touche LLP, recently warned Dubai business leaders to brace for slower tourist traffic in the months ahead.

“No one is immune from the global economic crisis,” he said.

That slowdown already appears to be affecting Arabian Park, a three-star hotel near the airport. While overall sales have increased since the hotel’s fiscal year began in June, business was down 6 percent in November and is lower so far again this month, Lee said.

“There’s no point avoiding the fact that it’s a lot more difficult now than it was before,” he added.

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PUBLISHED BY ‘THE DAILY STAR’ (Egypt)

Posted in BANKRUPTCIES - USA, DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, HOUSING CRISIS - USA, INTERNATIONAL, RECESSION, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE WORK MARKET, THE WORKERS, USA | Leave a Comment »

SUBPRIME FIASCO AND DEREGULATION

Posted by Gilmour Poincaree on December 9, 2008

December 08, 2008 Monday – Zilhaj 9, 1429

by Hasan Tariq Ghani

PUBLISHED BY ‘DAWN’ (Pakistan)

SUB-PRIME borrowers are defined as borrowers with a “bad credit history”. These borrowers have lesser credibility as compared to the normal conventional “prime borrowers”. Sub-prime borrowers also face high default risk, since some/most of them have faced bankruptcy in the past or have not been able to meet their debt obligations.

The broad category of these borrowers also incorporates the ones who have had lesser experience with debt and have a credit score (FICO score) below 620 (the score ranges from 300 to 850).

It is due to this high default risk on part of the borrowers that lenders demand greater compensation in form of higher interest rates. Sub- prime loans come in a variety of forms including sub-prime mortgages, car loans and credit cards. The most popular from among these aforementioned credit lines have indeed been sub prime mortgages. These mortgages are based on adjustable rate mortgages (arms) and are denoted by symbols such as 3/27.

The sum of the two numbers quotes the tenure or the time period of the mortgage (which in this case is 30 years), with the first number representing the number of years for which the interest rate on the mortgage remains fixed, regardless of market rates, while the subsequent number denotes the number of years for which the interest or the sub prime rate is adjusted according to a benchmark index.

According to the Wall Street Journal published in 2006, 61 per cent of the borrowers receiving the sub prime mortgages had FICO/ credit scores high enough to qualify as normal “prime borrowers”. But given the low interest rates for the first couple of years and an initial down payment lesser than $10,000, the “prime borrowers” were lured into taking on these risky sub-prime mortgages.

After the catastrophic events occurring on 9/11, the Federal Reserve (the American central bank), in an attempt to revive the collapsing American economy, started slashing the Fed Funds rate (inter bank lending rates), so as to increase consumption and spending by increasing money demand. Things were however running smoothly and the low interest rates were reaping the desired benefits for the American economy till the fear of inflation, or a persistent increase in the general price level, crept in.

In order to curb inflation, the Federal Reserve started increasing interest rates. This led to a proportional increase in the floating/adjustable part of the sub prime rates, which are linked to the benchmark interest rates and adjusted accordingly. This sudden and unexpected hike in the interest rate triggered massive foreclosures (seizure of property held as collateral by the lending bank) in the American mortgage industry.

The highly inflated so-called “real estate bubble”, which is very similar to the one currently being created in Dubai, finally exploded as the number of foreclosures in the American mortgage sector started picking pace. It was only a matter of time before the large investments made by mortgage firms and investment banks started going down the drain. To make matters even worse, a large portion of these “sour” mortgages were cut off into tranches, and sold off to investment banks, commercial banks and even the general public in the form of mortgage backed securities, after getting approval from different credit rating agencies, with the whole process being known as “securitisation”.

The originators(lenders) of these bad mortgages eventually thought that a bunch of hot shot investment bankers from Wall Street, by unleashing their creative skills, would come up with something innovative, that would help mitigate the risk of holding these “sour” mortgages by transferring the risk from their balance sheet on to a third party. This is a glimpse of how the process of securitization originated.

Some investment banks even went on as far as transferring their portfolios of “bad” mortgages to their fake off shore counterparts. One might wonder as to how these investment bankers were able to get good or at least decent ratings from credit rating agencies for the mortgage backed securities. Putting it in simple words, these highly qualified bankers were actually out “shopping” for credit ratings.

The rating agencies, after being intimidated by these investment giants, were forced to assign good ratings to their mortgage backed securities. After the formal window dressing process, these junk securities were sold off to investors, who unfortunately, were under the wrong impression of having sensibly invested their savings in lucrative ventures. Little did they realise that they would soon be weeping for having made the wrong investment decisions. It is also worth mentioning that some of these “dishonest” credit rating agencies are the same ones that have been very particular in downgrading our country’s credit ratings and making claims that we are on the verge of bankruptcy.

High rates of default by the sub prime borrowers led to the banks facing a liquidity crunch(severe shortage of cash), due to which they were unable to pay returns/interest to the holders of mortgage backed securities. Soon, the liabilities of many of these banks exceeded their assets, and once declared insolvent, many of these banks filed for bankruptcy.

The Federal Reserve played a key role in bailing out these distressed investment giants by acting as the lender of the last resort. But was it a wise decision to use hard earned tax payers money in providing temporary relief to those greedy banks that took on such risky investments? The $700 billion bail out plan by the Federal Reserve and the presence of the Federal Deposit Insurance Corporation (FDIC), seem to promote a phenomenon known as “moral hazard”.

Lets say hypothetically that a person gets a health insurance as well as a car insurance. Now this person is highly likely to drive recklessly and risk his life, given the fact that he knows that he is insured and will be compensated in the event of a loss or an injury. This explains the presence of moral hazard. Similarly, if the regulators keep on coming to the rescue of these banks who made certain reckless investment decisions by putting their shareholder’s and depositor’s money at stake, the banks are bound to behave in this fashion.

These private sector banks are the ones who have been favouring more of deregulation and comparing regulation with strangulation. But once in distress, they are the first ones to approach the government and the regulators for their assistance. A valuable lesson to be learned from the crisis is that a high level of deregulation can lead to a misery. In reality, there is no perfect example of a free market, or a market where there is no government intervention.

Certain checks and balances are necessary at the micro level in every sector of the economy to ensure it’s smooth functioning. The absence of a state can lead to anarchy and total chaos, which is exactly what we have observed in the sub prime debacle.

CLICK HERE FOR THE ORIGINAL ARTICLE

PUBLISHED BY ‘DAWN’ (Pakistan)

Posted in BANKING SYSTEM - USA, BANKING SYSTEMS, BANKRUPTCIES - USA, CENTRAL BANKS, COMMODITIES MARKET, DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SCAMS, FRAUD, HOUSING CRISIS - USA, INFLATION, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, STOCK MARKETS, THE FLOW OF INVESTMENTS, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, UNITED ARAB EMIRATES, USA | Leave a Comment »

PRESIDENT OF UNITED ARAB EMIRATES DOWNPLAYS IMPACT OF FALLING OIL PRICES AHEAD OF OPEC MEETING (Dubai)

Posted by Gilmour Poincaree on November 27, 2008

Last update: November 26, 2008 – 6:36 AM

Associated Press

DUBAI, United Arab Emirates – The president of the United Arab Emirates is Secretary-General Ban Ki-moon (left) holds a bilateral meeting with Khalifa Bin Zayed Al Nahya, President of the United Arab Emirates, at the Royal Guest Palace in Riyadh, Saudi Arabiadownplaying concerns about falling oil prices ahead of an emergency OPEC meeting later this week.

The Emirates is one of the world’s top oil producers.

Sheik Khalifa bin Zayed Al Nahyan says fluctuations in the price of crude are nothing new. He says the Gulf nation has lived through periods were prices were below where they are today.

The sheik spoke in an interview with Egypt’s influential Al Ahram newspaper. The Emirates state news agency WAM on Wednesday provided a transcript of the interview.

Khalifa says the Emirates is “closely monitoring” oil market dynamics and working with partners in OPEC “to face any negative impacts on the stability of world markets.”

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PUBLISHED BY ‘STAR TRIBUNE’ (USA)

Posted in COMMERCE, COMMODITIES MARKET, DUBAI, ECONOMIC CONJUNCTURE, ECONOMY, ENERGY, FINANCIAL CRISIS 2008/2009, INDUSTRIAL PRODUCTION, INTERNATIONAL, OPEC, PETROL, RECESSION, UNITED ARAB EMIRATES | Leave a Comment »