We are likely to see quite a lot of mileage out of this particular bit of clip art. True, we have managed to relegate the "Dubai crash" to the dustbin of over hyped crises, but Dubai does not seem particularly disposed to accept that as her ultimate destiny. The Nakheel bond is but a pair of weeks from default and creditors show no sign whatsoever of entertaining any sort of negotiated restructure, much less the suggestion of a moratorium to which creditors could only be heard to cackle loudly. We are certain all will, however, work out for the best. ("Nothing to see here. Please disperse.") Ah, would that it were so easy:
Fears are growing among western banks that Dubai Holding, the personal investment vehicle of the emirate's ruler, Sheikh Mohammed bin Rashid al-Maktoum, will be the next state-owned Dubai company to default.
The conglomerate went on a debt-fuelled spending spree in the past decade, borrowing $12 billion (£7.3 billion) to fund ambitious projects in Dubai and to create a private equity arm that bought stakes in Tussauds and the budget hotel chain Travelodge.
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