Crisis Puts Focus on Dubai’s Complex Relationship With Abu Dhabi – Dubai is seen as the brash, secular upstart of the seven emirates, and Abu Dhabi is known as the religious and conservative big brother. Tensions between the two are common, but when reporters questioned Sheik Mohammed of Dubai about problems last week, he told them to “shut up.” Abu Dhabi, which has more oil than Dubai and no cash problems, could wipe out Dubai World’s $59 billion in debt easily. But that seems unlikely. Despite the announcement by the emirates’ central bank on Sunday that it would make more money available to Dubai, such imprecise promises may not be enough to placate investors.
United Nations Says US Is Neglecting Deepening Homeless Crisis – Rolnik had waited more than a year to tour cities across the US to prepare a report for the UN’s human rights council on America’s deepening housing crisis following the subprime mortgage debacle. UN special rapporteurs are more often found investigating human rights in Sudan and Burundi or abuses of the Israeli occupation than exposing the underbelly of the American dream. George Bush’s administration blocked her visit, finding itself in the company of Cuba, Burma and North Korea in blocking a special rapporteur. "I was asking for almost a year before I as allowed in," Rolnik said. "But I didn’t expect to see what I have seen. In some ways the situation is worse than I expected."
New Law Would Give Foreclosure Protection To All In NY (M.W.)Last year, a new law was put into place in NY to help protect subprime mortgage borrowers from foreclosure. Now the state is on the verge of extending similar protections to prime borrowers, too. A bill passed by the State Legislature this month would require, among other things, that lenders give all borrowers 90 days’ warning before starting foreclosure proceedings and that they take part in settlement conferences with borrowers before proceeding with a foreclosure action. The bill also covers co-op owners.
Get Ready for Half a Recovery Mr. Shepherdson’s 2 percent estimate for gross domestic product growth next year is roughly half what he would normally expect for a solid economic recovery. And a crucial reason is the fact that bad assets on personal and institutional balance sheets are the equivalent of a ball and chain strapped to the economy, he says. “You can pick up that ball and walk with it,” he says, “but you have to walk slowly.”
The Real Conspiracy Was Launched By The Fossil Fuel Industry – There is, in fact, a climate conspiracy. It just happens to be one launched by the fossil fuel industry to obscure the truth about climate change and delay any action. And this release of emails right before the Copenhagen conference is just another salvo—and a highly effective one—in that public relations battle, redolent with the scent of the same flaks and hacks who brought you "smoking isn’t dangerous. The "Copenhagen Diagnosis" released today reveals that by any objective measure—melting ice sheets, greenhouse gas concentrations, sea level rise—the climate is warming faster than anticipated. And when the natural variability induced by massive climate systems such as oscillations over decades in ocean temperatures, currents and even sunspots reverts to the mean, the roughly three warming watts per square meter added by greenhouse gases will still be there to drive climate change.
Why a run on the U.S. dollar will start soon – Within the next 12 months, the U.S. Treasury will have to refinance $2 trillion in short-term debt. And that’s not counting any additional deficit spending, which is estimated to be around $1.5 trillion. Put the two numbers together. Then ask yourself, how in the world can the Treasury borrow $3.5 trillion in only one year? That’s an amount equal to nearly 30% of our entire GDP. And we’re the world’s biggest economy. Where will the money come from? Sooner or later, the creditors wake up and ask themselves: What are the chances I will ever actually be repaid? And that’s when the trouble starts. Interest rates go up dramatically. Funding costs soar. The party is over. Bankruptcy is next.
Gov. Paterson makes $1.1B in budget cuts and ‘juggles’ bills to cover state’s costs Gov. Paterson swung his own budget ax Sunday – implementing $1.1 billion in cuts and savings as weekend talks with legislators dead-ended with no deficit fix in sight. Paterson has warned that New York is going broke, struggling under a projected $3.2 billion deficit. The state has now resorted to "juggling" its bills, Paterson said, and is moving money around to cover costs in the absence of a deal with the Legislature. "We are out of time," Paterson said yesterday. "This is a fiscal emergency."
Congress’ next trick: Pull jobs out of a hat Whatever Congress decides, no single measure will be a panacea. Here are some of the leading ideas being discussed. Offer a payroll tax holiday; Temporarily suspending the payroll tax – which is a 12.4% tax on workers’ first $106,800 of wages – could accomplish two goals, supporters say.Create a new jobs hiring credit; The idea behind a hiring credit is to offer employers a sweetener if they bite the bullet and hire more people. Help close state and local budget shortfalls: With jobless rates rising in many states, revenue has fallen, leaving many states with yawning budget deficits. And this could cause the loss of up to 900,000 jobs in 2010 alone Offer public-service employment: Blinder and others have suggested the federal government put money towards creating new public-service jobs.
Va. to borrow $1.26 billion for depleted unemployment funds – As Virginia wrestles with ways to replenish its depleted fund for unemployment benefits, Hampton Roads employers expressed concern about the impact that higher unemployment taxes could have on the health of their businesses. The sorts of tax increases described by the Virginia Employment Commission earlier this fall may be difficult for some small businesses to absorb without job cuts, "For small retailers, the financial pressure from weak sales and higher unemployment taxes could be intense, Miller said. "You’ve got to have someone in the store, and if you’re down to one person in the store, you can’t cut any more."
Dubai Crisis Gives China Chance to Buy Oil, Gold: Report (ABC News) BEIJING (Reuters) – Dubai’s debt crisis could be China’s opportunity to snap up gold and oil assets, a senior Chinese official said in remarks published on Monday.""While the impact of the Dubai crisis on the global economy and on China was not known yet, it would last a while at the very least, Ji Xiaonan, who chairs the supervisory board for big state-owned companies under the State Council’s state assets commission, told the Economic Information Daily. "That could give China a buying opportunity to put some forex reserves into gold or oil reserves," Ji was quoted as saying by the paper, which is widely read by Chinese officials."
30 Global Financial Firms Listed As Systemic Risk Institutions – Thirty global financial institutions have been selected for cross-border supervision exercises by regulators. Compiled under the guidance of the FSB, the list is part of an effort to pre-empt the spread of systemic risks in the event of a future financial crisis. Those featuring in the list will also be asked to write so-called "living wills" that outline plans to wind up banks in the aftermath of a crisis. Here is the list, in full