Dubai under scrutiny after debt payment delay

[Al-Indunisiy]

Dubai's financial health has come under scrutiny after a major, government-owned investment company asked for a six-month delay on repaying its debts.

Dubai World, which has total debts of $59bn (£35bn), is asking creditors if it can postpone its forthcoming payments until May next year.

Dubai World has also appointed global accountancy group Deloitte to help with its financial restructuring.

The company has been hit hard by the global credit crunch and recession.

It was due to repay $3.5bn of its debts next month.

Put simply, everyone in the markets thought that, in the end, the federal government in Abu Dhabi would stand by all of Dubai's bad bets. Apparently, they won't.

Stephanie Flanders, BBC economics editor


Dubai: Too big to fail?
Dubai views: 'The end of the dream'
The request for a delay in repayments led to major credit ratings agencies downgrading a number of state-backed companies.

Following six years of rapid growth, the Dubai economy has slumped since the second half of 2008.

This has led to Dubai property prices falling sharply.

'Shocking'

The Dubai government said in a statement that the request to delay debt repayments also applied to property developer Nakheel, a Dubai World subsidiary.


ANALYSIS
Ben Thompson, business reporter, Dubai
Financial markets and businesses are closed here for the Eid holiday - some suggest that's why the announcement was made when it was.

It's sparked real shock that things have come to this. Just 12 months ago, few could have believed the city would find itself asking for this lifeline. It seems Dubai is now paying the price for living on borrowed money.

Of course, everyone knew the boom couldn't last forever, but no-one expected it to collapse when, or as suddenly, as it did. Property prices have more than halved over the past year and investors have fled.

The official figure for Dubai's debt is $80bn, but talk to anyone here and the feeling is the figure is much higher. Unpaid bills, abandoned cars and empty buildings are all too obvious. Some analysts put the real figure at close to $160bn.

"It's shocking because for the past few months the news coming out has given investors comfort that Dubai would most probably be able to meet its debt obligations," said analyst Shakeel Sarwar, of SICO Investment Bank.

Dubai is one of the seven self-governing emirates or states that make up the United Arab Emirates.

Analysts say the Dubai government has paid the price for a flamboyant economic model centred on foreign capital and giant construction projects.

Questions are now being raised about Dubai's ability to repay its debts, said the BBC's Middle East correspondent Jeremy Howell.

Some have speculated it is likely to turn to the more economically conservative Abu Dhabi emirate to bail it out.

Global credit rating agency Standard & Poor's, which rules on a company's or government's ability to repay its debts, said the announcement "may be considered a [debt] default".

Our correspondent said: "Standard & Poor's and Moodys immediately downgraded all six state-backed corporations in Dubai, downgrading some to junk status."

Junk is the term commonly used to describe bonds that are rated below investment grade by ratings agencies.

The Dubai World announcement was made on the eve of the Eid al-Adha Muslim festival, which will see many government agencies and companies close in Dubai until 6 December.


From BBC : http://news.bbc.co.uk/2/hi/business/8380105.stm

[Ramadhan]

What's surprising is not that Dubai World is asking for a lifeline from the creditors.
Having built such frivolities and monstrosities at break-neck speed on borrowed money over the past decade, it had been expected that the party would sooner or later come to an end. It is surprising that the end came with such a screeching halt.
And what is more shocking is that the Abu Dhabi government has refused to bail out Dubai World. For the past few years greedy investors keep pouring money into those projects in Dubai, confident that there is no way the oil-rich Abu Dhabi not bail out Dubai if it is in trouble.

[جوري]

That is what they get for investing their money on american hookers than spending it in the way of Allah..

7asbona Allah wa'ni3ma alwakeel

[Chuck]

This is funny, how this news is blown out of proportion as it is always with anything with the middle east. Ironically, muslims also jump the bandwagon without thinking.

Lets get real here. DW owes $59 billion debt, much of it is in Islamic sukuks. But anyhow lets focus on the numbers. First, $59 billion is nothing for multi-national corp like DW. Lehman brothers loss was $600 billion, GM loss is $90 billion, Madoff single handedly lost $59 billion and total loss in the current economic melt down is coming down to $2.7 trillion. What is this $60 billion of DW compared to those? Peanuts. Moreover, they are not defaulting in true sense, they are asking to postpone the payment deadline to 6 months until they restructure.

But it is fun to watch how markets are reacting over such a small news.

[nocturnal]

What's surprising is not that Dubai World is asking for a lifeline from the creditors.
Having built such frivolities and monstrosities at break-neck speed on borrowed money over the past decade, it had been expected that the party would sooner or later come to an end. It is surprising that the end came with such a screeching halt.
And what is more shocking is that the Abu Dhabi government has refused to bail out Dubai World. For the past few years greedy investors keep pouring money into those projects in Dubai, confident that there is no way the oil-rich Abu Dhabi not bail out Dubai if it is in trouble.

Indeed. I too found that rather shocking. I think Abu Dhabi seems to have come to the realisation that this is not - even by their impressive standards - a paltry some of money that they can gladly proffer to Dubai, it's quite a staggering amount. And in the midst of a global recession, they need to consolidate their own position let alone underwrite Dubai's bed debts.

Maybe Abu Dhabi will provide part of the money required, but if nothing else is forthcoming and the creditors seem unwilling to play along, then it seems like they might have to go cap-in-hand elsewhere to seek financial assistance.

[Ramadhan]

Lets get real here. DW owes $59 billion debt, much of it is in Islamic sukuks. But anyhow lets focus on the numbers. First, $59 billion is nothing for multi-national corp like DW. Lehman brothers loss was $600 billion, GM loss is $90 billion, Madoff single handedly lost $59 billion and total loss in the current economic melt down is coming down to $2.7 trillion. What is this $60 billion of DW compared to those? Peanuts. Moreover, they are not defaulting in true sense, they are asking to postpone the payment deadline to 6 months until they restructure.

But it is fun to watch how markets are reacting over such a small news.

What's shocking is neither the fact that DW is unable to service its debt nor the amount of its debt (still very large compared to its GDP), but the fact that Abu Dhabi is refusing to bail out DW.
Given how much Dubai has spent polishing its image as an international financial centre, asking for a delay is clearly the last option they exercised, and actually almost like suicidal.
This news holds more psychological value than economic, but it also give indication to the state of economy of other gulf countries.

[The_Prince]

this is a good thing for dubai, they needed something like this, its a reality check, and will only make them stronger in the future, from now on they will be more smart and realize times wont always be fruitful hence they need to be careful and not silly with their borrowing.

but its good one myth has been blown out of the water, dubai was not built on oil money at all, so all those baboons who kept saying once the oilllll runs out its all over! need to find a new line, since dubai didnt build on oil money, but used a good ole western tool of borrowing huge chunks of money from banks and nice rich people. ah now thats gotta hurt, a huge city built from sand without the oil money.

[The_Prince]

Indeed. I too found that rather shocking. I think Abu Dhabi seems to have come to the realisation that this is not - even by their impressive standards - a paltry some of money that they can gladly proffer to Dubai, it's quite a staggering amount. And in the midst of a global recession, they need to consolidate their own position let alone underwrite Dubai's bed debts.

Maybe Abu Dhabi will provide part of the money required, but if nothing else is forthcoming and the creditors seem unwilling to play along, then it seems like they might have to go cap-in-hand elsewhere to seek financial assistance.

or perhaps AD doesnt want to bail dubai out because they dont really need to, and dubai have it under control as they have said. there are two sides to a story, and what you mention is the western side, the very same western side who would love nothing more than to see Dubai collapse because it is a Muslim and Arab country, they have been out to get Dubai since day one.

whats more funny is that when you compare Dubai's debt to the debt of the USA then WOWWWWWWW i dont know what the hell everyone is so worried about!

has anyone forgotten about the ticking time bomb of the U.S. debt which they cant pay back? geeeee whats gonna happen when its time to pay up, and when the U.S. can no longer sustain itself because of the debt, heck the same applies to UK and many other countries. heckkkkkk whats gonna happen when people decide to dump the dollar (which is fast becomming a reality).

but nahhhhhhhhhhhh we will ignore all of this and concentrate on Dubai, lol.

[Beardo]

this is a good thing for dubai, they needed something like this, its a reality check, and will only make them stronger in the future, from now on they will be more smart and realize times wont always be fruitful hence they need to be careful and not silly with their borrowing.

That was a bold and courageous statement to make there, Bro.

But I suppose you are right. It is a reality check. They've been expanding like no OTHER, quite extravagantly.

I spent a whole summer in Dubai in the initial years of it's growth, which was (I believe) before the bars started opening etc in the early 2000s. I can't say I didn't enjoy it! You'd be amazed. So secure Masha'Allah. We used to leave our car unlocked, the GOLD SOUKS used to keep their stores open unattended during Salaah time. SubhanAllah!

...But things have changed.

[nocturnal]

Prince, I hardly think it is in the interest of the West to see Dubai implode in the manner in which you are describing. They have invested billions of dollars in Dubai and have a huge stake in it. Besides, this transcends religious and political issues, it is an economic issue and if they could have the affrontery to utilise billions of taxypayers dollars to bail out banks, then i don't think they'll shy away from assisting Dubai, even if it means pressurizing the IMF to take action. Afterall, the IMF after the London summit, did receive billions of dollars in additional funds for precisely this sort of crisis, not just to direct economic structuring programmes in third world countries.

[nocturnal]

And no one is in doubt as to the gravity of the situation rgarding US debt repayment, but even some of the most sceptical analysts believe the US and other EU nations have the wherewithal to deal with it unlike many of the nascent Gulf countries, especially Dubai which relied on fianance and construction to compensate for a lack of oil resources and unfortunately for it, proved to be two of the most devastatingly hit industires by the global recession.

[Chuck]

What's shocking is neither the fact that DW is unable to service its debt nor the amount of its debt (still very large compared to its GDP), but the fact that Abu Dhabi is refusing to bail out DW.
Given how much Dubai has spent polishing its image as an international financial centre, asking for a delay is clearly the last option they exercised, and actually almost like suicidal.
This news holds more psychological value than economic, but it also give indication to the state of economy of other gulf countries.

Asking delay is normal, world is going through a very difficult economic recession. But there is always so much hoohaa in western media for anything that is about middle east. At least one person is being realistic.

People are clearly overreacting, and that’s creating a good opportunity to
buy. Here’s why:

1. Dubai World’s debt of $60 billion compares to Lehman’s exposure of more
than $1 trillion when it collapsed. When Fannie Mae (FNM) and Freddie Mac (FRE)
were rescued, they were guaranteeing over $5 trillion in mortgages. When
American International Group Inc. (AIG) was rescued, it had over $200 billion in
credit default swap exposure. Similarly, Citigroup Inc. (C) and Bank of America
Corp. (BAC) had hundreds of billions in potential exposure.

Now, the U.S. stock market is higher than when all of those entities were
rescued. A $60 billion debt turning sour doesn’t (or shouldn’t) shock us
anymore, and the exposure of U.S. banks to this mess is minimal at best.

2. What in fact is the banking world’s exposure to Dubai? From a Goldman Sachs
report on Dubai issued Thursday: “We estimate the potential credit losses to
HSBC and STAN at US$611 million and US$177 million – or 4.6% and 3.9% of
2010E NPAT, 0.5% and 0.6% of 2010E equity.” In other words, nothing.

3. Plenty can happen between now and Monday. Dubai could come to agreements
with its creditors on the $10 billion, give or take, that is due in the next
month. Abu Dhabi, which has already agreed to lend Dubai $5 billion, has over
$650 billion in assets. Abu Dhabi will certainly negotiate agreements with the
creditors and buy debt for 60 to 70 cents on the dollar, avoiding the default of
its strategically placed neighbor. In return, Abu Dhabi will get massive
political concessions from Dubai.

This morning many stocks are falling. But this is not a repeat of last year’s
financial crisis. Many opportunities for snapbacks will appear. I’m going to be
keeping an eye, for the long side, on volatile stocks such as Citigroup; Apple
Inc. (AAPL); Dendreon Corp. (DNDN); Google Inc. (GOOG); STEC Inc. (STEC), which
I own; and heavily shorted stocks like Nutrisystem Inc. (NTRI), which should
benefit from post-Thanksgiving dieters, and priceline.com Inc. (PCLN).

http://blogs.wsj.com/financial-advis...-is-overblown/

[Sampharo]

Brother Chuck, I spent 20 years of my life in Dubai, 5 of which doing financial analysis and running my own financial brokerage firm.

I have to say this article you're quoting is infuriatingly devoid of economic principal or sense and I don't understand who would write something like that. What analysis in the World can EVER justify the failure of a company in one country based on how much it took for another company in another country with a different size to fail?!?! What financial data did the article rely on in order to equate a property master developer like Dubai World with car manufacturer GM or financial institution Lehman Brothers?

The analogy the article is using is like being in a cruising car on the highway that starts spitting, spatting and the dashboard indicator shows an empty gas tank, and one of the passengers saying: "It's impossible we are running out of fuel, my dad's 18 wheeler can go 1000 miles before running out of gas and we only drove 300." What a company with the history and size of GM did to fail, and the fact that the American administration succumbed to the lobby and decided to use taxpayer money to bail them out, has nothing to do with a ciompany with the different size and history and industry of Dubai World did, and there is neither going to be lobbying on their behalf nor American taxpayer money to bail them out.

Look, here is the actual situation: Asking for a delay in payment means they're running out of fuel AND the management team was incompetent enough not to be able to have sorted it out. It is a huge alarm in any terms and is called a default.

Additionally, the whole dubai market had alarm bells going on regarding its sustainability for more than three years, and more importantly the Dubai government has been doing a bad job of dismissing the solid data and breaches, which means that they were not facing the facts and had a problem with transparency. Having a problem with transparency means that new proper investors will not plug any serious money in there. Add to that the new rating of "Junk" which is really not that hard to understand for non-savvies. The situation is very much like a rich boy gambling in a casino that's bitten off more than they can chew, so much that the casino just cut off further credit and asked him to pay up, and instead of confidently taking out his chequebook and paying, he says: "Gee well... I am not liquid right now... but I am expecting some money real soon and.. and.." and then looking onto his heart-broken big brother "I promise you I am due for some money, I am just in a rut, I'll take care of everything I promise but if you just please liquidate the family trust-fund and let me keep playing to win the money back. Please I'll make it all back I swear!"

Dubai World in short is in deep &^*% whether they face the music or not. So much so that Dubai ruling family failed to come up with the money in time and Big Brother Abu Dhabi decided to cut them off. Nobody cares if they come up with the money later on because the default is already made and no one will extend any further much needed credit in the future, so there is no possibility of growth under the current ownership/management, and their greatest commodity (potential property profits based on Dubai's reputation) is already busted.

[Chuck]

Comparison was correct in terms of assessing financial fallout in the international market. To international banks it doesn't matter if $60 billion are lost by DW or GM, to them it is same.

Brother Chuck, I spent 20 years of my life in Dubai, 5 of which doing financial analysis and running my own financial brokerage firm.

I have to say this article you're quoting is infuriatingly devoid of economic principal or sense and I don't understand who would write something like that. What analysis in the World can EVER justify the failure of a company in one country based on how much it took for another company in another country with a different size to fail?!?! What financial data did the article rely on in order to equate a property master developer like Dubai World with car manufacturer GM or financial institution Lehman Brothers?

The analogy the article is using is like being in a cruising car on the highway that starts spitting, spatting and the dashboard indicator shows an empty gas tank, and one of the passengers saying: "It's impossible we are running out of fuel, my dad's 18 wheeler can go 1000 miles before running out of gas and we only drove 300." What a company with the history and size of GM did to fail, and the fact that the American administration succumbed to the lobby and decided to use taxpayer money to bail them out, has nothing to do with a ciompany with the different size and history and industry of Dubai World did, and there is neither going to be lobbying on their behalf nor American taxpayer money to bail them out.

Look, here is the actual situation: Asking for a delay in payment means they're running out of fuel AND the management team was incompetent enough not to be able to have sorted it out. It is a huge alarm in any terms and is called a default.

Additionally, the whole dubai market had alarm bells going on regarding its sustainability for more than three years, and more importantly the Dubai government has been doing a bad job of dismissing the solid data and breaches, which means that they were not facing the facts and had a problem with transparency. Having a problem with transparency means that new proper investors will not plug any serious money in there. Add to that the new rating of "Junk" which is really not that hard to understand for non-savvies. The situation is very much like a rich boy gambling in a casino that's bitten off more than they can chew, so much that the casino just cut off further credit and asked him to pay up, and instead of confidently taking out his chequebook and paying, he says: "Gee well... I am not liquid right now... but I am expecting some money real soon and.. and.." and then looking onto his heart-broken big brother "I promise you I am due for some money, I am just in a rut, I'll take care of everything I promise but if you just please liquidate the family trust-fund and let me keep playing to win the money back. Please I'll make it all back I swear!"

Dubai World in short is in deep &^*% whether they face the music or not. So much so that Dubai ruling family failed to come up with the money in time and Big Brother Abu Dhabi decided to cut them off. Nobody cares if they come up with the money later on because the default is already made and no one will extend any further much needed credit in the future, so there is no possibility of growth under the current ownership/management, and their greatest commodity (potential property profits based on Dubai's reputation) is already busted.

[Sampharo]

^ Brother Chuck, I don't think anyone here nor the opening post was suggesting in any way that the banking system will fail again because one corporation is not paying 3.5 billion in time. Glad to have cleared up the confusion though.

However, it does stand true that Dubai's economy has been over-inflated and that the master developer's failure along with loss of credibility and credit-worthiness, it is more than a detrimental blow to the city's financial health, if that is what you might have been referring to.

[Chuck]

^ Brother Chuch, I don't think anyone here nor the opening post was suggesting in any way that the banking system will fail again because one corporation is not paying 3.5 billion in time. Glad to have cleared up the confusion though.

However, it does stand true that Dubai's economy has been over-inflated and that the master developer's failure along with loss of credibility and credit-worthiness, it is more than a detrimental blow to the city's financial health, if that is what you might have been referring to.

The article was talking about reaction of the financial markets and media, mainly media, because financial markets reacted based on media. As far as Dubai is concerned, it is not contractually liable to pay the debts of DW, it could affect the face of Dubai but that is another issue. But DW is in trouble but still it is not in as bad situation as compared to other multinationals that went bust in current recession globally. DW has assets about $100 billion vs total debt of $59billion, thus has high level of solvency. Recently it raised $2billion in Islamic bonds and govt has injected $5billion in cash, so it has enough liquidity to deal with its short-term debt. However, they don't want to finance debt with debt, so they are restructuring their debt, which will help them in the long-term.

[Sampharo]

This is where I usually start going into an in-depth debate, but as I said: I ran a financial brokerage for 5 years and I did this for a living, and what you are quoting from these sources is not only wrong, but outright non-sense trust me.

Dubai World is a sheikhdom company and when it goes into this it shows that one of the pillars has fallen as predicted yet dismissed all along. Financial markets is a panicy market because it runs according to crowd psychology and the situation here is that finally even the stupid ones in the market have realized Dubai Inc is not as solid as touted. If the same family runs four businesses that carry the weight of a city's economy running out of oil, and every decent analysis source was saying they over-extended themselves, and then one of the companies fail and get restructured, you don't exactly get billions pumped into the rest. The kind of "don't worry it's normal" articles you're reading now is just apologetic garbage similar to the ones that swore financial banking system was doing great and there's no need to panic. It's delay tactics to milk the cow as much as possible and get the important money out before the sell-off of the regular people dips the prices into the ground.

It is because of such effect that EVEN if there was merit for the company to survive in the long-run, the well-known dive the prices will take dictates that anyone with ability should exit the company and wait for the rock-bottom to be reached, (planning to buy again the shares at fraction of their costs). This in itself is a possibility to force the company into final liquidation despite its assets.

Dubai World right now is in the crapper, and while you are speaking about how they are fine and adopting strategies that is better for them in the long run, Rothschild has been appointed to sell their assets, another sign that the company is failing.

[Chuck]

This is where I usually start going into an in-depth debate, but as I said: I ran a financial brokerage for 5 years and I did this for a living, and what you are quoting from these sources is not only wrong, but outright non-sense trust me.

Dubai World is a sheikhdom company and when it goes into this it shows that one of the pillars has fallen as predicted yet dismissed all along. Financial markets is a panicy market because it runs according to crowd psychology and the situation here is that finally even the stupid ones in the market have realized Dubai Inc is not as solid as touted. If the same family runs four businesses that carry the weight of a city's economy running out of oil, and every decent analysis source was saying they over-extended themselves, and then one of the companies fail and get restructured, you don't exactly get billions pumped into the rest. The kind of "don't worry it's normal" articles you're reading now is just apologetic garbage similar to the ones that swore financial banking system was doing great and there's no need to panic. It's delay tactics to milk the cow as much as possible and get the important money out before the sell-off of the regular people dips the prices into the ground.

It is because of such effect that EVEN if there was merit for the company to survive in the long-run, the well-known dive the prices will take dictates that anyone with ability should exit the company and wait for the rock-bottom to be reached, (planning to buy again the shares at fraction of their costs). This in itself is a possibility to force the company into final liquidation despite its assets.

Dubai World right now is in the crapper, and while you are speaking about how they are fine and adopting strategies that is better for them in the long run, Rothschild has been appointed to sell their assets, another sign that the company is failing.

Let me break it down:
(1) Dubai govt is not liable to pay for DW debts, what does that means? That means Dubai govt can let it go bust. It would affect the reputation of Dubai govt., but that doesn't really matter after so much Dubai bashing in the media that has taken since the financial crises. The fallout would be on investors and creditors.

(2) Fallout on the international financial system is nothing compared to what we have seen in the current crises. $59 billion is nothing compared to $2.7 trillion. This whole panic is nothing more than a sensationalism with middle east of western media.

(3) DW has $100billion estimated asset at the end of 2008. Estimate was after the nov 2008 market crash so that estimate is fairly valid still. DW is in very good position still, nothing compared to Lehman bros. whose debt was nearly 1 trillion and 600 billion was never recovered. If DW is forced into liquidation all the debt will be recovered.

You might be in finance, but you saying some general thing which doesn't mean much like the western media. I suppose you don't like Dubai.

Second, I can tell you I'm UCLA graduate economist and consultant for big financial firms. I'm currently working in Middle east. I'm quoting, because I want present something with backing.

[Sampharo]

Let me break it down:
(1) Dubai govt is not liable to pay for DW debts, what does that means? That means Dubai govt can let it go bust. It would affect the reputation of Dubai govt., but that doesn't really matter after so much Dubai bashing in the media that has taken since the financial crises. The fallout would be on investors and creditors.

No one cared if they were liable or not. Their entire construction economy was dependent on reputation and with its failure the economy is badly hurt.

(2) Fallout on the international financial system is nothing compared to what we have seen in the current crises. $59 billion is nothing compared to $2.7 trillion. This whole panic is nothing more than a sensationalism with middle east of western media.

Again no one cared or addressed that.

(3) DW has $100billion estimated asset at the end of 2008. Estimate was after the nov 2008 market crash so that estimate is fairly valid still. DW is in very good position still, nothing compared to Lehman bros. whose debt was nearly 1 trillion and 600 billion was never recovered. If DW is forced into liquidation all the debt will be recovered.

You seem to be still speaking about the effect on international financial institutions which nobody questioned nor cared about. You're creating your own argument to validate quoting something irrelevent.

You might be in finance, but you saying some general thing which doesn't mean much like the western media. I suppose you don't like Dubai.

Second, I can tell you I'm UCLA graduate economist and consultant for big financial firms.

If you then call yourself an economics major and a financial consultant and then think that love and hate of a place has anything to do with it, and are going to mash sensationalism and religion into a financial analysis of a firm, then you are consulting on office stationary cost savings no more, or flat out lying to save face.

There is nothing general about calling a failing company "a failing company". This whole thread is about the company itself and its default, and your posts along with the quoted article is saying that the company is in good shape, which is a load of garbage in anyone's dictionary. No generalities there. Everytime that is pointed out you seem to run to "it has little effect on international market", which is an irrelevent fact that no one even mentioned.

If you subscribe to wrong information, it is your perogative to stay ignorant, but don't say stupid things like that and then claim to be a professional "consultant" to big financial firms. Otherwise of course you are working for a "Dubai government" financial firm that is ordered to release and spread articles about how great Dubai financial situation and economy is.

[Chuck]

No one cared if they were liable or not. Their entire construction economy was dependent on reputation and with its failure the economy is badly hurt.

Again no one cared or addressed that.

You seem to be still speaking about the effect on international financial institutions which nobody questioned nor cared about. You're creating your own argument to validate quoting something irrelevent.

If you then call yourself an economics major and a financial consultant and then think that love and hate of a place has anything to do with it, and are going to mash sensationalism and religion into a financial analysis of a firm, then you are consulting on office stationary cost savings no more, or flat out lying to save face.

There is nothing general about calling a failing company "a failing company". This whole thread is about the company itself and its default, and your posts along with the quoted article is saying that the company is in good shape, which is a load of garbage in anyone's dictionary. No generalities there. Everytime that is pointed out you seem to run to "it has little effect on international market", which is an irrelevent fact that no one even mentioned.

If you subscribe to wrong information, it is your perogative to stay ignorant, but don't say stupid things like that and then claim to be a professional "consultant" to big financial firms. Otherwise of course you are working for a "Dubai government" financial firm that is ordered to release and spread articles about how great Dubai financial situation and economy is.

You are getting emotional. I don't know exactly why. But simple question, tell me this. A company has $100 billion in assets and $59 billion in liabilities, is this a good or bad debt to equity ratio?