The Dubai Default

[Paradoxium]

Would be the largest sovereign default in a decade. We will probably see cheaper oil prices.

The Dubai Default and Oil Prices
Dubai default fears spook investors

European banks have exposure to Dubai. If Dubai collapses, it won't be pretty.

I was calling for deflation (last post in the libertarian thread). It looks like there will be a run to the dollar. Deflation absolutely kills those in debt or in deficit spending (aka what the government is doing now). This continues to be the reason why I disagree with the simple message of Ron Paul and simple money printing. You are not accounting for credit destruction and money velocity.

GOLD is not a direct hedge on inflation. It has dropped from 800s to 200s before during inflationary periods. It is a crisis hedge. This means it's good right now still.

 

[Paradoxium]

Many are postulating this is the black swan event akin to last years banking meltdown. This should be interesting.

 

[VampElvis]

I just heard this on the radio. ~60 billion owed. This will get ugly quick.

 

[Paradoxium]

They did not want to depend on oil, so they tried to "diversify" into construction, real estate and finance as means of economy. Both of these are areas fueled by inflationary credit (all bubbles), and there is nothing sound about it. What happened is: oil, finance and construction were nailed simultaneously.

 

[Erundur]

Dubai deserves what it gets.

 

[Backdrifter]

I remember watching a program on Discovery about Dubai and all their crazy building projects (building islands...?). One thing comes to mind: hubris.

 

[Marx]

This whole situation is very interesting.

 

[Paradoxium]

Dubai World’s Debt Not Guaranteed by Government
Holy **** someone grew a brain unlike the American government. t:

 

[VampElvis]

Wow, I'm at a loss for words on this one.

 

[Paradoxium]

Today is Bizzaro day. A government makes the right call... then we have a progressive cheerleading economist say this:

Even Krugman Admits the Deficit Is Unsustainable

 

[Erundur]

yippee kay yay mother****er

 

[SuBe]

Does anyone think California and the American Government will learn from Dubai's example, or are we going to continue down this path?

 

[Handsome Rob]

Does anyone think California and the American Government will learn from Dubai's example, or are we going to continue down this path?

"Too big to fail." Sorry, SuBe, but I think we'll continue down the path.

 

[Paradoxium]

Hahah I hope that is a rhetorical question SuBe

Seriously, it's pretty sad when the middle east and some parts of east asia is more capitalist than the United States.

 

[Paradoxium]

Wow the dollar index did not go up. Went from 75 back to 74. Guess people really losing faith in it now.

 

[Paradoxium]

Creditors to refuse Dubai World deal
Dollar spike.