Dubaï: crisis again!

The History is going on. With the alarming news on the finances of the emirate of Dubai, many people wonder if we are not reliving the crisis of September 2008 which brought down Lehman Brothers.



The same fall of stock exchanges, the same lies, the same blindnesses touched the heart of the biggest financial centers in the world, on the ground of threat of bankruptcy from a Dubai model built on the unlimited debts.

Indeed, on Thursday, November 26th, in Paris, London, Frankfurt or Tokyo, the markets of debts got into a panic and stock exchanges dived of more than 3 % on average - Wall Street, for its part, was closed on Thursday, because of Thanksgiving. The movement of decline continued on Friday in the morning. In Asia, the stock exchange of Taipei ended with a decline of 3,21 %, Sydney also fell by 2,90 % whereas in Bombay, the market opened with a drop of about 3 %.
In the first exchanges, on Friday morning, Paris fell by 1,71 %. The financial values were the most affected by these turbulences, showing declines of more than 5 %. While the investors were convinced that the financial crisis was ended, here is the restart.

In this crisis, we find the same guilty actors than in the Lehman brother crisis: the big international banks. These establishments financed blindly the most crazy and expensive projects of the Sheik Mohamed. Of course to free himself from speculations, the emir, Sheik Mohammed, will have to bring clear answers to the important questions on the motives for the implosion of Dubai .

" The lenders were persuaded that the boom was eternal and that in case of any problem, the emir or his defender would pay their debts because they cannot lose the face, but that was not the case ", underlines an expert of the City. Nevertheless, the enormous lack of transparency of the property market should have incited the financiers to be really careful.

Dubaïrotes has a hangover. Country of the immoderation, their emirate is at the edge of the bankruptcy today, with the incapacity to honor its financial commitments. The shock of the announcement, on Wednesday, November 25th, of the rescheduling of the debt of two of its key groups (the Dubai World conglomerate and its Nakheel subsidiary (property market)), until May 30th, 2010 at least, was amplified by the fact that nobody expected such a cataclysm like that. Markets thought that the cyclone was gone away.