Today, after U.S. stock markets opened following Thanksgiving Day the news that some had known about for at least nine months - the extension of the global banking crisis to the city of Dubai - has hit the mainstream.
Markets continue to fall as financial news reports on Dubai, the Persian Gulf City built by migrants, is close to economic collapse, according to a majority of news reports.
See - http://www.youtube.com/watch?v=VKr7TP8t9Qk&feature=related
On Wednesday, November 25, 2009, the government of this semi-autonomous city-state with the world's tallest tower announced to the world that it needed time to restructure its $60+ billion debt, and asked creditors to delay debt repayments until May 2010.
Early exchanges fell on the news as the U.S. markets closed for Thanksgiving Day. Those markets, which opened Friday, continue to down slide in stocks.
Stocks fell Friday, Nov. 27th with investors worried that a major government-backed investment company in Dubai risked defaulting on $60 billion in debt. The fears ripped through world markets and served as a reminder of how fragile the financial system remains a year after it nearly collapsed.
The Dow fell 154.48, or 1.5 percent, to 10,464.40.
The S&P fell 19.14, or 1.7 percent, to 1,091.49.
The Nasdaq composite index fell 37.61, or 1.7 percent, to 2,138.44.
For the week:
The Dow is down 8.24, or 0.1 percent.
The S&P is up 0.11, or less than 0.1 percent.
The Nasdaq is down 7.60, or 0.4 percent.
For 2009:
The Dow is up 1,533.53, or 17.5 percent.
The S&P is up 188.24, or 20.8 percent.
The Nasdaq is up 561.41, or 35.6 percent.
So, what is really happening here?
Simply put: tens of millions and billions in defaults on massive debt repayments amid a banking crisis started by bankers, and into late 2009, continued by bankers.
Dubai is nothing new, as entire nations who took part in huge debt financing schemes over the past 12 years are seeing major reversals based on the fact that the banks are hording cash from the public's till to save themselves.
Dubai, for 20 years, has led a feverish rush to construct the world most expensive hotels, bejeweled with technology-rich gold-plated suites, condos and homes, along with its huge shopping malls for the wealthy - has now come to an end.
The city-state known as the westernized oasis of the Middle East is about to see a radical personality change as it deals with being $60-80 billion in the red.
Dubai, oasis in the desert -
In my mundane forecast, there are forces operating now that in the years ahead will turn Dubai from its western-style "Las Vegas in the desert" personality to another far-more conservative and right-wing religious personality - one of strict Saudi control with devastating consequences for the city-state of Dubai and its people.
Not much has been heard from Dubai's ruler, the billionaire mover and shaker, HH Sheik Mohammed Bin Rashid Al Maktoum, since the bank crisis set in late last year. Rumors emerged that thousands of migrant construction workers and foreign support staffs were being deported out of the city as construction projects ground to a halt and hotels empty out.
Tourism is down substantially while a majority of Dubai's workers have not been paid. Dubai, which has had a reported 500,000 migrant workers, have been paid as little as $1 an hour to build at speeds unheard of in modern times.
At one time, Dubai's migrant workers were building condos at a rate of one new floor every four days; working day and night in two 12-hour shifts, six days a week. Round the clock construction. It is no wonder that Dubai sprouted from the desert into the gleaming city now billions in debt.
Now, the government is hunting down these workers, deporting many of them while some migrant workers who incurred debts during their time in the United Arab Emirates are seeing time in Dubai's debtor's prisons - that are filling up according to reports.
The worldwide Bank Crisis is one that was manufactured by very greedy, corrupt and inept financiers, and their workers, who, since the heady days of the 1990s and 2000s gambled huge amounts of money on debt finance - only to leave countries, states, and cities in the lurch as their populations struggle to make ends meet.
What is also not being so easily seen is that while most wait for recovery is the fact that tens of millions of lives are changed and that little will remain the same after the Bank Crisis of 2007-2010 is over.
"I think this is a sign of things to come," said Dave Rovelli, a managing director of trading at brokerage Canaccord Adams in New York. "Commercial real estate continues to go lower. People are going to continue to default on debt payments."
The problem with Wall Street, from an astrological point of view, is uncertainty. It is either good news or bad news - but never uncertainty. The eight-month rally in U.S. stocks now depends on the mood of investors and traders as the Bank Crisis sees no end in sight going into 2010.
Dubai is yet another example of wasted resources, built on debt, and gambling on a future that was not forecasted astrologically. This is what happens when one tries to make one's way in the dark without knowledge and action on the global transits.
Dubai In Crisis
See recent CNN International interview: [length: 7 minutes] -
http://www.youtube.com/watch?v=vM5h6r2I_64&feature=related
On November 27, the AP reported - "The latest trouble on Wall Street come as the U.S. kicks off the unofficial start to the holiday shopping season. Investors will be tracking news from retailers for insights into how much consumers will spend in the coming month. Consumer spending is the biggest driver of the U.S. economy.
In the first hour of trading, the Dow Jones industrial average fell 174.35, or 1.7 percent, to $10,290.05.
The broader Standard & Poor's 500 index fell 22.58, or 2 percent, to 1,088.05, and the Nasdaq composite index fell 41.77, or 1.9 percent, to $2,134.28.
Energy, materials and financial stocks posted some of the biggest losses as commodities fell and investors worried about bank balance sheets.
Investors rushed into the safety of U.S. government debt. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.23 percent from 3.28 percent late Wednesday.
The yield on the three-month T-bill, which is considered one of the safest investments, rose to 0.04 percent from 0.03 percent.
The ICE Futures U.S. dollar index, which measures the greenback against a basket of foreign currencies, jumped 0.8 percent. The yen rose to a 14-year high against the dollar.
Commodities, which are priced in dollars, fell as the dollar gained. The move reflected an unwinding of trades that relied on a weak dollar to finance purchases of higher-yielding assets.
Spooked traders reversing the so-called "carry trade" were demanding safe-haven assets.
Investors have been pushing into riskier assets for months as they seek higher returns. U.S. interest rates are at record lows, making riskier investments like stocks an enticing alternative to the paltry earnings of safer investments like government debt.
Trading volume in November has been light as many professional investors have pulled back from markets in hopes of locking in the big gains for 2009.
Rovelli said investors have been too quick to assume that the financial markets are on the mend.
"We're way ahead of ourselves in this market. We're in the eye of the storm now and we've been in it since March," he said. "Now we're in the back end of the storm."
This report was published in February 2009 on Dubai, and shows that the signs were around as late as 2008 -DUBAI, United Arab Emirates — Sofia, a 34-year-old Frenchwoman, moved here a year ago to take a job in advertising, so confident about Dubai's fast-growing economy that she bought an apartment for almost $300,000 with a 15-year mortgage.
Now, like many of the foreign workers who make up 90 percent of the population here, she has been laid off and faces the prospect of being forced to leave this Persian Gulf city — or worse.
I'm really scared of what could happen, because I bought property here, said Sofia, who asked that her last name be withheld because she is still hunting for a new job. If I cant pay it off, I was told I could end up in debtors prison.
With Dubai's economy in free fall, newspapers have reported that more than 3,000 cars sit abandoned in the parking lot at the Dubai Airport, left by fleeing, debt-ridden foreigners (who could in fact be imprisoned if they failed to pay their bills). Some are said to have maxed-out credit cards inside and notes of apology taped to the windshield.
The government says the real number is much lower. But the stories contain at least a grain of truth: jobless people here lose their work visas and then must leave the country within a month.
That in turn reduces spending, creates housing vacancies and lowers real estate prices, in a downward spiral that has left parts of Dubai — once hailed as the economic superpower of the Middle East — looking like a ghost town.
No one knows how bad things have become, though it is clear that tens of thousands have left, real estate prices have crashed and scores of Dubai's major construction projects have been suspended or canceled. But with the government unwilling to provide data, rumors are bound to flourish, damaging confidence and further undermining the economy.
Instead of moving toward greater transparency, the emirates seem to be moving in the other direction. A new draft media law would make it a crime to damage the country's reputation or economy, punishable by fines of up to 1 million dirhams (about $272,000). Some say it is already having a chilling effect on reporting about the crisis.
Last month, local newspapers reported that Dubai was canceling 1,500 work visas every day, citing unnamed government officials. Asked about the number, Humaid bin Dimas, a spokesman for Dubais Labor Ministry, said he would not confirm or deny it and refused to comment further. Some say the true figure is much higher.
At the moment there is a readiness to believe the worst, said Simon Williams, HSBC banks chief economist in Dubai. And the limits on data make it difficult to counter the rumors.
Some things are clear: real estate prices, which rose dramatically during Dubai's six-year boom, have dropped 30 percent or more over the past two or three months in some parts of the city.
Last week [February 2009] Moody's Investors Service announced that it might downgrade its ratings on six of Dubai's most prominent state-owned companies, citing a deterioration in the economic outlook.
So many used luxury cars are for sale , they are sometimes sold for 40 percent less than the asking price two months ago, car dealers say. Dubai's roads, usually thick with traffic at this time of year, are now mostly clear.
Some analysts say the crisis is likely to have long-lasting effects on the seven-member emirates federation, where Dubai has long played rebellious younger brother to oil-rich and more conservative Abu Dhabi.
Dubai officials, swallowing their pride, have made clear that they would be open to a bailout, but so far Abu Dhabi has offered assistance only to its own banks.
Why is Abu Dhabi allowing its neighbor to have its international reputation trashed, when it could bail out Dubais banks and restore confidence?
Author Christopher M. Davidson, who predicted the current crisis in his 2008 book: The Vulnerability of Success, said that perhaps the plan is to centralize the U.A.E. under Abu Dhabi's control. This, he surmised, would sharply curtail Dubai's independence and perhaps change its signature free-wheeling style."
The impacts will be many: already societies around the world who are suffering because of the Bank Crisis will enter into their second or third year by 2010 of economic distress.
Burdened with speculators' hiked-prices, outrageous interest rates, corruption, greed, and mountains of debt - it should not be a surprise to anyone that the year 2010 will see great changes and transitions that will significantly mark the decade of the 2010s.
Global Transits
The Dubai situation is a classic one of "see no evil, hear no evil." For years, the HH Sheik Mohammed Bin Rashid Al Maktoum could have easily invested in detailed astrological reports designed to maximize the success of Dubai.
His highness, and his city-state administration would have been counseled that rather than house a half-million migrant worker force a mile or more away from the city they were building and pack these men six to a room living basically in shacks, why not serve the best interests of construction and growth to do the right things?
Astrologically, the advice would have been the opposite to what was done. It would have been better to house the entire construction force in the city. Why not house these hard working men in the very opulent hotels they built - with the best service given to them?
Would not these working men also provide you with the best they have, rather than subjecting them to low wages, threats, debt prisons, and no safety standards?
By doing what is right - giving the best service to the working men building on deadline, and housing these men in nearby luxury hotels they themselves formed, giving them benefits, rest, peace of mind, safety, and inclusion - then would not the Sheik and his staff be fulfilling the word of Allah?
If God's spirit lives within Man, then is it a bad thing to house the spirits of the workers in the best rooms, provided with the best service, and to reward the very men building the great city of Dubai as they rested from 12-hour day and night shifts six days a week?
If the sheik had done this - the U.A.E. surely would not be on the verge of collapse that it is today. And, it goes to show, that even billionaires must gain astrological counsel before attempting ventures.
Now that the global Saturn/Pluto square is here, and, just months from the T-square configuration of the Cardinal Crisis transits, it appears unlikely that Dubai will emerge out of the mess it finds itself.
The pressures to make due on $60+ billion in debt, the losses amounting in Dubai's residential and commercial real estate, and the fact that many construction projects are in limbo or being canceled outright shows just how poor the strategic planning for Dubai has been.
Responses by Dubai's government to bad publicity has backfired. Now, with the Saturn/Pluto square, and next year's cardinal Crisis transits, it is more than likely that the poor strategic social planning, news, and backroom international finance and business deals that cover Dubai's recent history will emerge into the light, placing even more pressure on Dubai to repay its massive debt load in a global recession.
This is a direct result of the total lack of practical strategic planning that first must be done astrologically and humanly to be successful. Dubai is yet another sad example of how little high finance power players know about forecasting the future. The costs for this, as we have seen, are very high.
As the world enters into the cycle from December 2009 to August 2010 - a nine-month period that will feature, according to my calculations, the start of a new more serious phase of the global bank crisis, it is expected that the major transition from the post-modern world of the late 20th century into the technological world of the second decade of the 21st century will speed up.
What is happening to the city-state of Dubai is a crisis of massive proportions. Unless the city-state acts prudently, the economic woes will last for longer than many would like. The debt crisis in Dubai will continue into 2010 and early into the next decade until there is a strong practical shift away from the fallacies, the poor treatment of workers, and the high cost of living in the city.
Most would not listen to the forecasts during the 1990s and 2000s about the global transits, and the coming impact at the end of the decade of the 2000s. It was too far away, most said. Now, that time is here, and all the preparation time of the last 10-12 years have been lost.
The current transit of Saturn square Pluto from November 2009 through April 2010 sees increasing power struggles around finance, politics and ideology. Then, in summer 2010, the planets Jupiter, and Uranus will come into the mix - filling out the Cardinal Crisis.
We should see this occurring in Dubai at this time, and these internal power struggles will change the "personality" of Dubai to the point of those who have invested and remained in the city-state may have to face the growing hard-line ideology of the powers that be in Abu Dhabi.
In the past 20 years, Dubai's great physical growth should have arrived at the same time as its growth in common humanity, but, sadly, it has not. The city-state now faces global transits that require navigation to return the city to what its own public relations desired to show the rest of the world.
Can it be done? Yes, nothing is impossible if what has been done is undone. First, the debt of the workers must be paid, benefits paid, and the city given to them to live in the splendor of what their own hands built. Stop forcing workers to sign 10-year contracts, and stop confiscating the passports of the family men who build your city. This will save Dubai.
Release those who are Dubai's debtors' prison. Forgive their debts, and shower the workers with housing, and gifts. If this is done, Dubai will be saved and shall emerge from its debt, and the city will thrive once again. Let the workers continue to complete the work while their debts are forgiven, their benefits and rewards increased - and Dubai will be saved.
It this too much to ask? If Allah can forgive many times over, is it no less for the leaders of the U.A.E. to forgive one another, to do good, and to not repeat the errors of their former ways?
What will save Dubai is a "change of heart" - not change from $80 billion. What goes around comes around. Astrologically, there is still a little time left, but without a change of heart, and, by definition, a change of mind and attitude, Dubai will continue to head in very much the wrong direction.
I can tell you from astrological knowledge - that that direction - if it continues, does not have a happy ending. Not at all.
There are two ways this can end - either a love story or a disaster film. The choice is up to the ones writing that book. And transits just keep on moving...
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