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+--- Thread: UAE - Market Situation (/showthread.php?tid=5457)
- kamranACA - 03-07-2009
Dear,
It's really a very nice input. I wonder if you are not an economist or investment related professional.
Keep it up. We ned people like you.
Best regards,
KAMRAN.
- Goodman - 03-08-2009
dubai does not have no oil exports. Dubai's economic fallout is a direct result of western economic problems. Dubai's economic model relies heavily on foreign investment, a commodity which is in short supply these days in the world. Unless the world moves away from its economic conditions, dubai is unlikely to recover.
Opec cant tie their own shoes properly without permission leave aside the price hike to 140 dollars. The recent oil prices were directly linked with the excessive credit that was made available to oil companies by banking sectors and especially in the last days of bush administration. I dont think we will see the repeat, unless their is a natural reason in either Africa or oil supply routes.
I really hope the economic conditions start to reverse out soon, unless unpopular decisive actions are taken by politicians we are heading for a deeper recession. Worldwide massive bailouts are now starting to result in deficit financing. I feel by the end of this year we will start to see signs of a general inflation in the world economy, which will lead to increased interest rates.
Finally, why is it so that these audit firms who have been so successful all over the world failed to notice so spectacularly that their banking clients were exposed to massive specific market risks and yet all the audit reports of all the failing banks were clean like rain water?
- CFANerd - 03-08-2009
KamranACA I am a person with street knowledge
- CFANerd - 03-08-2009
Goodman. You may be right. Last time I studied economics was 10 years ago. I want to add comment to your audit firm comment. Remember nowadays govts are corporations and corporations are govts. AA and Cooper audit firm shredded their papers right before they could be used against them in court. Lehman brothers was showing profit until the last quarter before they went bankrupt. Ha! What a joke.
- Pracs - 03-08-2009
Interesting discussion here CFANerd, Goodman, Kamran.
CFANerd, your comment about AA is well documented and recent history. Re Coopers and Lybrand, can you provide a link or any further details, I was working for this firm when the worldwide merger took place with Pricewaterhouse, today's PwC and do not remember any such allegations, moreover the merger came about due to a mutual desire by CL and PW and had nothing to do with a regulatory or market driven need. Care to please expand.
Goodman, re audit firms clean reports and current market conditions,. well just my cent here, I guess some of these risks were beginning to trickle through the Director's/Chariman's report under the Operational matters and prospective reporting. I think the single most factor in this whole liquidity/credit induced recession is the popularity of Complex (yet lightly regulated) Structured finance products (CDOs, ABS, MBS etc.), the pretext being you minimize risk if you spread it across the industry, across geographical locations. The first line of blame or responsibility should be at Banks that issued underlying mortgages (primarily in the US to the subprime market quite a few including Indymac, Freddie mac, Fannie mae), followed by Investment banks who packaged these and sold it all over the world (the likes of Lehman), the credit rating agancies (Moodys, S&P)who were too slow to react, the Investors (our high street banks, hedge funds, pretty much any one with some cash in hand) relying way too much on credit rating agencies, the regulator (FSA, SEC in the US etc.) for not doing much about it anyways and the last but not least the auditors for having accepted this as a good business model having run its course for some 20+ years.
- kamranACA - 03-09-2009
Dears,
Dubai (not the whole UAE) is not purely based upon oil exports. It's a truth. It was also based upon foreign investment and was a hub of the international business. When people start playing with money they try to create money without having any foundation, merely through speculative approaches. Majority of the individuals were relying on micro financing and personal loans. I mean everything they had. In contrast prices of properties were touching the skies. This was all due to speculation based upon interest based economy and a quest for luxurious life. So when the crises hit the Dubai and they lost their jobs they had nothing liquid to manage their lives. Their properties and assets were either subject to loans or proved to be non marketable commodity due mainly to two reasons i.e. unrealistic high prices, vanishing of liquidity from all the economy.
This is the first time that such a substantial number of people have left this country. They left their (around 3000) cars on airports and did not even bother to take out the keys. The people who came to Dubai with millions had nothing while reverting. They were unable to sell their properties and could also not pick them back to the home countries. The banks do not know how to realise their loans. There is no buyer even if they re-possess the mortgaged properties.
God knows where the crises created by speculations, interest based economy and coupled with the situation created by the so-called war against terror will take the world to.
Dubai is now looking forward to Abu Dhabi for the bailout. Let's see what happens next.
Regards,
KAMRAN.
- sumairalam - 03-10-2009
Dear Respected Members,
Some points to clarify
1) There is nothing like hundreds of cars abandon in Dubai or any of the states or airports- some people left the cars but the figures are in tens.
2) Buyers for the properties are in market but of course you can not get what you are expecting.
3)It is a universal truth if you spend more than your earning ( through credit cards or loans) you will be in trouble.
5) We are discussing about UAE Economy fallout , but is there any parameter to check or confirm this?
In Tourism
Abu Dhabi expects total of 1.5 million tourists in 2009 almost equal to 2008 figure. No projects abandon or on hold in Abu Dhabi.
The Sharjah Commerce and Tourism Development Authority (SCTDA), overall number of guests climbing from the 1.45 million seen in 2007, to 1.53 million in 2008, achieving growth of over five percent.
This increase in tourism pushed the overall occupancy in Sharjah's hotels to 86 percent in 2008, up from 85 percent in 2007.
The number of visitors to Dubai increased by three per cent during the third quarter of last year compared to the same period in 2007, according to data released from Dubai's Department of Tourism and Commerce Marketing (DTCM) yesterday.
The emirate received 1.79 million visitors between July and September 2008, compared to 1.74 million to the same period a year earlier.
GDP already mentioned in above post.
Investments- UAE is invested a lot in South America and Africa.
UAE Economy is not only based on Oil, but Gas , Supply of Building Materials and non-metallic minerals. + other factors.
Just for Example
Banks slash car financing , Car Rental Companies business increased.
Construction slows down, Rent increases in available buildings
Consumers Industry attracting customers by Sales and promotion, Marketing / Advertisement companies business increases.
Mergers / Bailouts , Audit / Consultancy / Risk managers companies business increases.
People are going / people are coming, Travel agents business not affected.
and so on....
6)Just to clarify I never discussed the economy of USA.
Best Regards
- kamranACA - 03-11-2009
The figure of around 3000 cars was quoted in some article published by a newspaper last days. The people based at UAE must be knowing better.
JAANEY NA JAANEY GUL HE NA JAANEY.....
Regards,
KAMRAN.
......edited for adding the poetry verse.....
- rabia-k - 03-11-2009
this is judt a false rumour . only 11 cars have been found abandoned at the dubai airport.
you can read the story here, if you wish
http//archive.gulfnews.com/nation/Police_and_The_Courts/10282898.html
- Goodman - 03-11-2009
Some of posts are very long but there is little substance in them. Say if no. Of visitors can be a test of development then I hope my friends would agree that Saudi Arabia, Iraq are the most developed countries in the world, and I think their travel agents would also be gold by now.
It is NOT a universal truth that if you spend more than your earning you will be in trouble. I spent more than my earning for almost four years in a row but i am not in any difficulty......depends what you spend it on and how good you manage it later?
I am blissfully surprised to note that some members consider that Dubai has avoided the worldwide effects of current economic turmoil. They have to be angels to have done it and we all know there ainât no angels there.
- Toronto_Boy - 03-12-2009
In my view, UAE and other Gulf countries which are unable to retain population would be effected more as compared to Pakistan, USA or any other country. If the people leaving country in result of losing jobs, then where consumption spending would go that supports economic activity, both in short and long-run, and is much needed to come out of recession and for recovery. Market support through cousumers spending, and resulting business profits would be at their minimum. Just to understand this phenomena, imagine about extreme hypothetical situation in which no market sentiments or market itself would remain existant if their are not enough buyers. Their malls, shopping plazas, entertainment centres could be deserted place if they would not have enough consumers to buy. Same negative impact would be on services sector.
In any case, these countries would have more negative multiplier effects on economy as compared to Pakistan or any other country where at-least their population remain there in recession and support market mechanism through daily necessary expenses.
I think, their labour laws and policies have back lash effect. It is the time for those governments (like UAE) to keep population inside the country through change in policies and government spendings.
Interesting thing is, Arab money is being kept in foreign countries for decades, and channeling back as foreign investment. Now, they are dependent on this foreign investment.
- sumairalam - 03-12-2009
Dear Respected Members,
The purpose of providing the positive side of the pictures of UAE is to just inform the people living in UAE to do not make decisions on the basis of assumptions about the failure of Dubai Economy in near future. The hot topic in every discussion nowadays in UAE is about the economy and dubai future, although its good to warn, but here people are making worst decision because of these rumors.
People are starting selling their assets in very low prices in a perception that the price will go down more.
When you live in a country where your job at risk because of these crisis , good news about the economy growth will give you much boast.
Further all the information provided are for analytical purposes this will help the readers to make conclusion with real facts.
Again the post become longer but I would like to reply for the following points raised
1) What Toronto_Bay is mentioning is 100% correct and UAE Government is also working in the same line. Some examples are withdrawing the "one family one villa" rule, proposal of non-putting ban on canceled visas, and withdrawing some of the visit visas rules.
2) People do not visit Saudi Arabi or Iraq for tourism and also their economy is not based on tourism.
3) Our company has hired and issued 148 visas in different categories all related to construction in last two months for our new projects. But is this shows that construction is booming in UAE or construction industry is hiring people?
Newton said "To every action there is always opposed an equal reaction" I threw the ball on the wall but it didnt return - Newton law is wrong.
Best Regards
- kamranACA - 03-12-2009
Dears,
I just thought, if we are not getting news about 3000 cars on airports etc from the people at Dubai, could it be owing to the governmental controls on the media. A fellow pointed out that even in case of crimes government does not allow to on-air such news at least until the issue is resolved.
May there be similar reasons.
The statement of Lieutant General Dhahi quoted by Rabia may be an official statement. We remember when Lal Masjid incident took place there was hell of difference between the death toll declared by Government and the figures quoted by other media sources. Similar was the case when earthquake hit Pakistan's northern areas.
Regards,
KAMRAN.
- kamranACA - 03-12-2009
Rabia,
Would you like to look at following links. All are reporting same figure i.e. 3000 cars. I am not arguing, rather telling you what the world discusses.
http//www.autoblog.com/2009/02/18/why-have-there-been-3-000-cars-abandoned-at-the-dubai-airport/
http//www.daijiworld.com/news/news_disp.asp?n_id=55704&n_tit=Indians+Flee+Dubai+as+Dreams+Crash++-+Fall+out+of++Economic+Crisis
http//www.juancole.com/2009/01/3000-abandoned-cars-at-dubai-airport-as.html
Perhaps this "3000 cars" has become so famous that you merely paste 'DUBAI+3000 CARS' in any search engine, you will get loads and loads of links discussing the same thing.
Regards,
KAMRAN.
- sumairalam - 03-13-2009
Dear Kamran,
May be the figures are higher than reported by ministry but I am sure this can not touch 3000 Cars figure.
I personally visited the terminals at that time and didnt find more than usual cars parked.
Best Regards