A very simple image illustrates the global insolvency characteristic of today’s global financial system: the financial base upon which banks, insurers and global financial institutions were resting, is collapsing in the same way as a city built on a huge fault would collapse. (1)

A real-life building collapse happened this month in Dubai. (2) (3)

Dubai is a perfect example of this image of a city built on soft ground (in this case, on sand); indeed, the Emirate is now experiencing a general price collapse of all the wonderful real estate investments made in the past few years. (4)

Just one year ago, property prices in Dubai were surging to record peaks undeterred by a real estate slump in major markets, but they have since gone into free fall and have yet to find the bottom. Dubai house prices are plunging into uncharted territory, said AFP four days ago. (5)

This planet’s collapse is starting in Dubai where the financial base upon which banks, insurers and global financial institutions were resting is collapsing in the same way as a city built on a huge fault would collapse.

“Omnia cadunt et morituri moriuntur.”
Everything collapses and the mortals will die.

Ivo Cerckel
honestmoney@maktoob.com
http://twitter.com/ivocerckel/

(1)
Two major processes at the centre of the phase of global geopolitical dislocation
- Excerpt GEAB N°32 (February 16, 2009)
http://www.leap2020.eu/Two-major-processes-at-the-centre-of-the-phase-of-global-geopolitical-dislocation_a3694.html

(2)
Twitter spreads news of Dubai building collapse around the world
By Adam Flinter, hub editor
Published: August 16, 2009, 19:40
http://www.gulfnews.com/nation/General/10340901.html
Dubai: As news of the building collapse in Deira broke, thousands of people were following the latest developments on micro-blogging site Twitter.

(3)
From The Sunday Times August 16, 2009
Dubai collapse sparks £3bn in legal claims
(Steve Crisp/Reuters)
Grinding to a halt: British firms are owed £400m
http://business.timesonline.co.uk/tol/business/industry_sectors/construction_and_property/article6797762.ece
SNIP
The collapse of Dubai’s once-booming construction industry has created a backlog of legal claims totalling almost £3 billion.
Disputes over unfinished contracts and outstanding payments are stacking up in the emirate’s arbitration court, according to Building magazine.

(4)
Note to the text quoted in note (1)
Two major processes at the centre of the phase of global geopolitical dislocation
referring to
Dubai Property Prices May Fall Up to 50 Per Cent: Research Issac John
2 February 2009 http://www.khaleejtimes.com/darticlen.asp?xfile=data/business/2009/February/business_February61.xml§ion=business

(5)
Dubai house prices plunge into uncharted territory
By Ali Khalil (AFP) – 4 days ago
http://www.google.com/hostednews/afp/article/ALeqM5hyQZBDKz-1scTSlHP2F0HtrpoNxA
SNIP
DUBAI — Just one year ago, property prices in Dubai were surging to record peaks undeterred by a real estate slump in major markets, but they have since gone into free fall and have yet to find the bottom.