Sunday, November 29, 2009

Dubai Crisis??? Explanation of Financial Crisis & Why It is Not Former President George W. Bush's Fault

It seems as though appearances can be deceiving. In recent years, Dubai has been thought to be one of the few cities in the world that has had a thriving economy amidst the economic global crisis. But, I guess Dubai's supposedly booming economy bubble is about to burst. If Dubai defaults on its debt than it could become an International nightmare that would escalate troubles within our present economic crisis. It is more probable than not that Obama will play the blame Bush game if Dubai's financial troubles causes havoc across the globe. BO seems to be unable to take responsibility for anything. This financial crisis is not former Pres. George W. Bush's fault. The Democrats blocked his every attempt to avert the crisis before the financial meltdown occurred. The Democrats were getting kickbacks for supporting Fannie and Freddie. The Democrats did not want to accept the reality that Fannie and Freddie would hurt the economy if nothing was done because they didn't want to give up all their lucrative side deals that they had with Fannie and Freddie employees. Bush tried to stop the crisis and is now being unjustly blamed for something that in reality, wasn't and still is not his fault. And, that irks me to no end. The Democrats due to their ineptitude and being morally bankrupt are the people who need to be blamed for this financial crisis. But, then again, I don't think that Democrats are capable of accepting responsibility for their actions, or inaction.

Here is the article on the debt crisis in Dubai, and three videos explaining exactly how the financial meltdown occurred, and how the Bush administration tried to stop this financial crisis from happening, but Democrats blockaded all of his administration's attempts to stop the housing crisis at every turn.

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 1.9 percent to 940.30 as of 1:55 p.m. in New York, extending this week’s decline to 2.6 percent.

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.
‘Best-Case Scenario’

“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.

Bank of America estimates that Dubai’s debt totals $88 billion, and that its external debt equals 103 percent of gross domestic product, according to a separate report. CONTINUED



Snarky Basterd said...

Better start collecting rocks. The polished and rounded ones will become legal tender.

The Born Again American said...

I've been collecting rocks for years, the only problem is they are in my head...

Thanks for the tutorials, wanna buy my house?

Opus #6 said...

What is so wrong about living within our means. People need to learn about that. My grandparents learned about it in the great depression.

Teresa said...

I hope not. But, just in case I will start collecting rocks.

Teresa said...

The Born Again American,
I think I have some rocks in my head,too.

Sorry, I would love to buy your house, but unlike others I realize that I cannot afford to buy a house.

Teresa said...

I totally agree. People need to learn to live within their means.

Amusing Bunni said...

I'm sick of everyone blaming Bush for Everything.
At this rate, why don't we blame Abe Lincoln for everything, I have a few things I could say about that...hee hee. Great post, Teresa. Happy Sunday night. I have some good stuff on my page, if you want to see.

Anonymous said...

I wouldn't say it is not completely Bush's fault. For the first bail out didn't help,and he could have worked harder to stop Fannie and Freddie, and repeal Community Reinvestment Act.

I see this as the Keynesian fault, which falls on both parties. Those are the folks who would rather have central controlled economies, rather than Austrian economics, or free markets.

Ron Russell said...

Blame! Blame! Who gets the blame! It doesn't matter to me. The fact is that all governments are spending more than they take in. Government spending across the globe is out of control with politicians not caring about anything except the next election. The debt as they see it will hit somewhere down the road and is not there problem. Sometimes the chickens come home to rest to soon and then they may have to answer. Keynesian economics does come into play and many have fallen for something that has been proven wrong over and over again, but many nevertheless continue to worship at the temple of John Maynard Keynes as tho he were some god. This Dubai thing could spread we will have to wait and see. A great detailed post Teresa as usual.

Teresa said...

Amusing Bunni,
Me too. The blame Bush game must stop. Have a great day!!

Teresa said...

Here's the deal- The cause of the financial crisis does not lie with George Bush. Maybe he could have done more but with 9/11 and other issues related to that he had an awful lot on his plate already. The Democrats are the ones who had ACORN threatening banks and forced them to give loans to the financially challenged. This was not the Republicans doing. So, to me the root cause and blame lies with the Democrats. The only way to make sure that this never happens again is to ascertain what exactly was the root cause of the financial crisis. And, George Bush was not the root cause of the financial crisis. It stems from both Carter and Clinton forcing banks to give loans to people they full well knew couldn't afford it. All due to social justice. And, that is what forced the banks to ask for a bailout. So, the government screwed the banks, and in return the banks needed a bailout because of the government.

Anonymous said...

Everything wrong with the world today is Bush's fault. Don't you people ever read a newspaper?