Prieur’s readings (November 27, 2009)

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This post provides links to a number of interesting articles I have read over the past few days that you may also enjoy.

• Jim Krane (Financial Times): Dubai gambles with its financial reputation, November 26, 2009.
The government’s decision to postpone debt repayments could make the emirate’s rivals more attractive, persuading international companies to decamp to Doha or Abu Dhabi.

• Roula Khalaf (Financial Times): Emirate has a lot of explaining to do, November 26, 2009.
The decision to ask bondholders of Dubai World to extend maturities from December to May 2010 was a bombshell and the emirate will pay the price for a long time to come.

• Steve Hanke (CATO Institute): 2009 in charts, November 2009.
This has been a very good year for charts and tables. In this article, Prof Hanke updates some of his favorites.

• Jeremy Warner (Telegraph): As one crisis recedes, the fiscal one may be only beginning, November 25, 2009.
It is hard to recall a time when opinion on asset markets was more sharply polarised between bulls and bears. But then it is also hard to recall a time when the future course of the world economy looked so uncertain.

• Ambrose Evans-Pritchard (Telegraph): China, gold, and the civilization shift, November 26, 2009.
Stephen Jen from the hedge fund Blue Gold Capital has a warning for those who think that gold has risen far too high, is necessarily in a speculative bubble, and must soon come clattering back down. Mr Jen is an expert on sovereign wealth funds from his days at Morgan Stanley. The gold story – essentially – is that the rising economic powers of Asia, the Middle East, and the commodity bloc are rejecting Western fiat currencies. China, India, and Russia have all been buying gold on a large scale over recent months. Why should that stop when the AAA club of sovereign debtors is pushing towards the danger threshold of 100% of GDP?

• Robert Lenzner (Forbes): Run with the gold bulls, November 25, 2009.
As long as the cost of borrowing money is zero, gold will continue to strengthen and the dollar will continue to weaken.

• Nouriel Roubini (Forbes): Will the world go shopping? November 26, 2009.
The wobbly holiday retail outlook in North America and Europe.

• Alan Beattie in London and Geoff Dyer (Financial Times): Free-market ideals survive the crunch, November 26, 2009.
Beyond the financial crisis: The global crisis prompted more than the loss of a string of financial institutions, it also inflicted collateral damage to the ideology that had sustained the rich world, or at least the US – that of finance capitalism.

• William Watson (Financial Post): How to deal with bubbles, November 25, 2009.
Lean or clean: Should central banks lean against the bubble winds, or wait to clean up after the bubble has burst?

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