Is Dubai Too Big to Fail?

Is Dubai the same as AIG?  Is it too big to fail?  Should the United Arab Emirates bail out its partner? We'll soon find out when a $60 billion debt default by one of Dubai's state-owned conglomerates shakes out.  The impending default hit hard the stock markets in Asia and Europe.  One would have expected gold to have soared in value.  Instead, according to the Wall Street Journal:

The dollar and the yen roared higher Friday as the fallout from the Dubai debacle continued to resonate through global financial markets. Proving that gold doesn't always benefit during bouts of risk aversion, gold fell 4% along with a decline in crude oil.

Meanwhile, equities markets across Asia fell sharply Friday. Japan's Nikkei 225 Average fell 3.2% to 9081.52, its lowest close since July. In Hong Kong the Hang Seng Index plunged 4.8% or 1075 points to 21134.50, led down by banking stocks. HSBC Holdings shares in Hong Kong fell 7.6% and Standard Chartered shares closed down 8.6% on news the banks were directly exposed to Dubai's debt problems. [NN: Emphasis added.]

US banks although not directly exposed could take a major financial hit according to CNN, "...the ripple effect could be more crippling, according to Richard Bove, a bank analyst with Rochdale Securities."   Bove went on to state,

...the underlying problem is that there is a lot of uncertainty floating around. For example, there's little information available about counterparty derivatives, guarantees that transfer default risk from lenders to other financial institutions. And it's unknown how much of Dubai World's debt guarantee is held by U.S. banks.

Now there is pressure on the United Arab Emirates (read Abu Dhabi) to step in with financial support (read bailout) for Dubai's financial problems.  Are they thinking of the wildly successful US TARP (Troubled Asset Relief Program) bailout of banks holding bad paper?

Flashback to the looting of US Treasury by the new Wall Street Leftist Robber Barons, the key words of the day were that such companies like AIG holding this bad paper were "too big to fail" and that we were facing the biggest financial crisis since the Great Depression. 

From the auto industry to state and local governments, everything seems to be falling apart in this country. Yet, there are some people walking the streets free as birds that are responsible in large part for this economic mess.  Bush Treasury Secretary Hank "Shifty" Paulson is probably the greatest flim flam man in the history of the United States. He managed to legally (sic) rob Fort Knox for his Wall Street Left Winger Masters  after others have failed miserably to rob Ft. Knox.  Prominent Wall Street Left Wingers include Robert Rubin, Warren Buffett, Larry Summers, and just anybody that works for Goldman Sachs or Morgan Stanley.  (So much for the bulls**t about rich Republicans.)

The Emergency Economic Stabilization Act of 2008 (ESSA) was initially intended to be the U.S. financial system bailout. It authorized the U.S. Secretary of the Treasury to spend up to $700 billion to purchase distressed financial assets. The man on the street understood this law as being intended to cover the assets of banks and financial institutions holding bad mortgage-backed securities and to make capital available to those institutions in order to prevent a major depression.

This scam by Shifty Paulson grew from a sketchy three page notes to 110 weasel-worded pages. Meanwhile, fellow flim-flam, ex-Fannie Mae front man, Franklin Raines is laughing his $93 million in bonuses assets off in fancy restaurants in DC. The noted House  imbecile Maxine Waters and the gay pimp Barney Frank covered for corrupt leftists like like Raines.  The Wall Street big boys, (a.k.a., the Masters of the Universe, see the Tom Wolfe novel Bonfire of the Vanities for an explanation of the reference), are also getting some of that government loot. [NN: Note to self: It pays handsomely to have friends in high places. Yeah I know that Liberal dumbells everywhere will say that everybody does it! Yeah but it's still illegal and unethical.] 

Meanwhile, the American taxpayer as always will be left holding the bag and will be rewarded with huge tax increases to cover the cost of corruption. ESSA also included a variety of “buy offs” (similar to earmarks) designed to get a sign-off from individual Congressmen/women for legalized theft of taxpayer money. American taxpayers were told UNLESS THIS WAS DONE IMMEDIATELY THE WHOLE WORLD WIDE FINANCIAL SYSTEM WOULD COLLAPSE!  If things were really that bad why did Slick Hank feelthe need to buy Congressional votes?  Well, 13 months later most of the TARP loot is unspent, Goldman Sachs Execs are getting great bonuses, and unemployment is over 10%.  How's that "Hope and Change" workin' out for you Dumbos that voted for Ovomit?  I hope that the UAE honchos will be smarter than the Brainiac Liberals that are running America.