knight

The Dubai Debacle: Is It a Game-Changer?

Some thoughts as I live in Dubai and hold the bonds

Nakheel 09/ Dubai bonds
It has been a very interesting/difficult week with regards to our holdings on the Nakheel bonds. The unimaginable happened which caught everything and everyone off guard. The last two weeks investors were full of confidence as S.MO (Dubai ruler) himself said 10 days ago they were prepared to meet all debt obligations and for those people who think Abu Dhabi and Dubai don’t stand together to “shut up”. The consequence of their actions will be severe as investor confidence is now completely lost. Dubai economy is based on 3 things.
1. Financial services
2. Real estate
3. Tourism
With this latest move they effectively killed 2/3rds of their economy. The real estate sector was picking up and this effectively killed any rally. It would not surprise me if prices drop by another 30% from current levels. People are saying if they can do this in the international market who knows what they could do in the local markets. Bond prices have been quoted on Friday between .45 cents to as high as .75 cents. The trading volume has almost been non existence as few hundred thousand dollars are changing hands in a given DAY. If they don’t pay the bonds by December 31st 2009 they will be in default. This would then trigger a series of events which no one knows would take place. Some are hopeful they pay the bonds I am not as the damage has been done. Asian markets and markets around the world have been punished since this announcement with some markets off by 7% in the past TWO days alone. Weather this is contained or leads to a broader sell off will remain to be seen. Abu Dhabi has said they will choose which entities to support from Dubai world. Nakheel being one of the biggest they will need to decide if this is of strategic imoportance and to big to fail or to big to save.

If you wanted to restructure your bonds its your right but it shouldn't be done 2 weeks before you are meant to pay it and 10 days ago saying the face value increase by 6 dollars to 115.5 per share because there is no IPO. On numerous instances you had the leaders of Dubai saying they were prepared to meet all its debt obligations this is dishonest and deceitful

Dubai's Disabused Creditors

Some thoughts as I live in Dubai and hold the bonds

Nakheel 09/ Dubai bonds
I
t has been a very interesting/difficult week with regards to our holdings on the Nakheel bonds. The unimaginable happened which caught everything and everyone off guard. The last two weeks investors were full of confidence as S.MO (Dubai ruler) himself said 10 days ago they were prepared to meet all debt obligations and for those people who think Abu Dhabi and Dubai don’t stand together to “shut up”. The consequence of their actions will be severe as investor confidence is now completely lost. Dubai economy is based on 3 things.
1. Financial services
2. Real estate
3. Tourism
With this latest move they effectively killed 2/3rds of their economy. The real estate sector was picking up and this effectively killed any rally. It would not surprise me if prices drop by another 30% from current levels. People are saying if they can do this in the international market who knows what they could do in the local markets. Bond prices have been quoted on Friday between .45 cents to as high as .75 cents. The trading volume has almost been non existence as few hundred thousand dollars are changing hands in a given DAY. If they don’t pay the bonds by December 31st 2009 they will be in default. This would then trigger a series of events which no one knows would take place. Some are hopeful they pay the bonds I am not as the damage has been done. Asian markets and markets around the world have been punished since this announcement with some markets off by 7% in the past TWO days alone. Weather this is contained or leads to a broader sell off will remain to be seen. Abu Dhabi has said they will choose which entities to support from Dubai world. Nakheel being one of the biggest they will need to decide if this is of strategic imoportance and to big to fail or to big to save.

If you wanted to restructure your bonds its your right but it shouldn't be done 2 weeks before you are meant to pay it and 10 days ago saying the face value increase by 6 dollars to 115.5 per share because there is no IPO. Its dishonest and deceitful

The Decline of Credit Cards

Please dont single out this current goverment but almost all the goverments of the past has done this as well. If America really wants change they need to vote for Ron Paul. Its to bad he will never win.


On Nov 12 10:06 AM casey00001 wrote:

> Felix: Its interesting that you think people should not spend beyond
> their means which is a correct line of thinking in my opinion, however
> you have absolutely no problem with the current administration spending
> way beyond the Government's means. Please explain?

Cramer's Mad Money - When the Facts Change...(10/23/09)

forget calling the bottom I acutally bought at the bottom (week before) still not bad. Just sold to early ;(

Volatility Index Falls Below 21 to New 13-Month Low

I dont know if that is an indication that the worst is behind us or their is complacency in the market. Their are at least 3 more shoes to drop in housing which will then effect the banks etc.

Google Signals Shareholders Will Take the Back Seat Now That Economy Is Recovering

When they re priced all thier options for thier employees at $300.00 they told the shareholders to fk off basically. In the long run not sure how much you wnat to be invested in a company that doenst care so much for its shareholders.

AMD Stock Spin-Off Insider Trading: What Were They Thinking?

I for one could never understand what greed does to some people. The latest hedge fund to go bust tries to make 20 million dollars on insider trading when he is worth 1.5 billion. how can this make any sense??

Deja Vu 2008: Crude Oil Market Entirely Detached from Fundamentals

I stand corrected. Thank you for your informative article.


On Oct 19 10:40 PM Dian L. Chu wrote:

> GLA??? ?
> Do you mean Greenlight Advisor??
> Yes, I guest post there via Mr. Prieur du Plessis, a noted money
> manager and SA author as well. This article happens to be one of
> them.
> I contribute regularly to 4 sites including SA, and through content
> distribution, you will find my articles in lots of different sites.
> Regardless, "sources of my articles" are from myself and my blog.
>
> As you can see, author credit and link back to my blog are clearly
> at the top of the article on Greenlightadvisor.com.
> greenlightadvisor.com/.../
>
> Thanks for your readership.

Deja Vu 2008: Crude Oil Market Entirely Detached from Fundamentals

You should be quoting the source of your articles as this came directly from GLA.

Elizabeth Warren: 'Big Banks Always Get What They Want'

SHE is the only one with the balls to call it like it is. Timmy, Larry and Ben should take some notes. These 3 are a cancer to the system!! They dont care about you they care about where they are going to work once thier role is up for the gov. Timmy cant even sell his house he had to put it on rent. Probably took advise from Ben when he said their is no housing crisis and went and bought a home. HA.

Who Is Carlos Slim in Today's Market?

The only way to stop GS JPM is to ban lobbying all together until this happens nobody will care about your interest.

Insider Selling Still Accelerating

I think is also up to the average American to get up and stop watching football and being distracted by these mindless nuances to actually do something. More concerned about Britniy Spears then how they are being robbed by these big banks.

Lululemon: High Quality, Debt Free, Fast Growing - Odlum Brown

I third that. The company P/E is extremely high which can be justified for a growth company such as apple however they are not growing as same store sales would indicate so its relatively expensive but hoping for a major pull back to accumulate shares at a more reasonable level.

Where Is This Market Going?

Great article and I couldn't agree with you more. The markets can stay irrational longer than you can stay solvent. Just keep your cash ready for the pull back whenever it comes. There are few things one must also take into consideration the volume of this rally has been extremely low and 40% of it has been done by machines. I would not be chasing here or even close to here. Capital preservation with solid opportunities will present itself. As far as Obama is concerned I am not an American so I did not vote but there is no question I would have voted for him. It is truly disappointing he made Timothy G his head guy when he was directly involved with the mess running the New York Fed. How do you keep Berneke at the helm when he basically accelerated this whole mess by dropping interest rates in 2005. The sad part is Obama is spending way to much money and I don't think it matters anymore if you vote for Democrat or Republican their main purpose is to get as much money for themselves as possible. Damn morals ethics and responsibility. I don't even want to get started on George W. If Americans wanted REAL change Ron Paul would have been the way to go. Sadly it will be to late to ever see him in office.

There Are No Good Choices for the Fed

Hey John,

Glad you took up the advice to write on SA. I think you work is great and you explain it in a very commense sense way. Keep up the good work and look forward to reading more of your stuff on SA

Salman