Dubai World Sends Shockwaves Through The Financial World

Gambling News - December 3rd, 2009 - Written by Bonnie Ritter

Dubai World sent shockwaves through the financial world several days ago when it filed for an extension to repay the $59 billion it owes to several finance companies across the world. Although India's Finance Minister Pranab Mukherjee stressed that there is really no reason for panic, investors in Dubai World have quickly begun to panic.

"The full impact of the Dubai debt crisis is yet to be assessed, but there is no need to press the panic button," he said. "First of all, the amount is small and secondly, the exposure of our banking systems to the Dubai financial systems is limited."

Essentially what is happening is the region of Dubai became a booming place for investing years ago, and mounted the whopping sum of debt by renovating the area for visitors, and the state-owned investment company, Dubai World, is due to repay most of the money soon. But in late November, it asked to withhold repayment until 2010, which is usually a bad sign for smaller investors in the region, hoping their money will be repayed with interest. The leaders of the region shook off the notion that it illustrates a weakness in funds, saying that it is not an warning sign of default and that pundits are overreacting.

As an example of how important repayment can be in the financial world as a sign of strength, consider Bank of America, which announced on Wednesday that it is ready to repay the $45 billion it borrowed from the United States Federal Reserves as part of the TARP initiative. Financial personalities hailed the news, and agreed that it will become much easier to find a new CEO without the restrictions and limitations hanging overhead, which were given as terms with the bailout money.

Given the recent news, DSI proposes the question of what bank will be most affected by Dubai's revelation. Entertainment Betting is a great way to voice your opinion, and maybe make some money at the same time.

BANK AFFECTED THE MOST BY THE DUBAI CRISIS

HSBC +200
STANDARD CHARTERED -125
BARCLAYS +220
ARAB BANK +135
CITIGROUP +350