Monday, November 30, 2009

Is Dubai Too Big to Fail?

Is Dubai too big to fail?...

I liked Daniel Gross's Lehman analogy, only I find it a bit off, by a few orders of magnitude. Dubai is not Lehman Brothers, Nakheel is Lehman Brothers (And only metaphorically... Nakheel's debts amount to a high single digit percentage of what Lehman's were at the time of their collapse).

Yes, Dubai World and Nakheel are large companies, but in comparison to the size, not just of Dubai's economy, but of the large merchant families in Dubai (Futtaim, Galadari, Gargash, etc), they'd be like a sub-section of a department of a division were Dubai seen as a single corporate entity.

Yes, Dubai has seemed a bit flashy in recent years, but deceptively so, the way a sumo wrestler seems fat. There actually is a lot of substance underneath. As someone on the ground out here, I can tell you that the malls are jam packed (even the brand new mega malls), the roads are still clogged, the new metro is seeing increasing ridership every month, and major Dubai corporations like Dubal (7th largest aluminum producer in the world), Ducab (largest cable manufacturer in the middle east), DP World (Which, while a subsidiary of Dubai World, was excluded from DW's debt restructuring), and Emirates Airlines are all making money hand over fist.

The National's Wayne Arnold notes a few things the international media seems to have missed in their rubbernecking rush:

Dubai has never defaulted on or missed a debt (loan or bond) payment

Dubai is not a sovereign entity

Nakheel is a private company. (Nakheel's sukuk was never backed by the Dubai government and never even had a credit rating)

Dubai's traditional economic backbone has, and always will be trade facilitating infrastructure. This includes the Dubai Creek dredging, the Jebel Ali port development, the airport expansions, and now the Dubai Metro.

The money is there, but there are politics involved. Abu Dhabi's SWF alone has aver a trillion US$ in assets. The whole of Dubai's debts are a rounding error in the Abu Dhabi portfolio. The issue with Dubai World and Nakheel is not a lack of funds, on the part of either the Dubai government or the Abu Dhabi government. The issue is... something else.

Update: Ezra Klein gives a hat tip to an elightening graph that kind of garrotes the Dubai-Lehman analogy.

Tuesday, November 10, 2009

Moving Smoothly Along

I've been remiss lately, but mostly due to a sustained flurry of activity at work that reached it's final, climactic crescendo today. Our school has bee pursuing accreditation with one of the largest accrediting bodies in the United States, the Southern Association of Colleges and Schools (SACS), and today was the big visit/assessment/interrogation.

It will be a while before the results filter down to us, but regardless of the outcome, the process itself seems to effected an enormous amount of change already. As a colleague of mine noted, just the act of delving deeply into the practices of the school, and evaluating those practices with an objective standard, has forced a number of departments to really up their game, and look seriously not just at what is being done, but why.

This accreditation process really began about a year ago, and I was intimately involved with the drafting and editing of the initial assessment reports, which gave me a perspective on the school I had not had before.

Before this, I could look at a new initiative, or a current process, and see it cynically. I can't seem to do that anymore. Which is, perhaps, for the better.

In any event, there was actually something else on my mind today, something I noticed in class as I was teaching, or, more specifically, not teaching.

A week ago each student was finally given their shiny new MacBook Pros. Unfortunately for the students, the process was a little bit "nature red in tooth and claw," since there are a gand total of two IT guys who had previously served about a 100 and change admin and teaching staff. Throw on the implementation of an entirely new system, server architecture, plus 1000 new customers, and you have yourself a couple cases of cardiac arrest. Just to keep from being trampled to death by a constant stampede of flummoxed students, the IT boys had to basically show everyone the hand, and limit themselves to a small set list of specific tasks. The students, then, were left to their own devices.

As a long-time Mac user, and a more than a bit of a geek, I was able to get my students configured and running without a hitch. Unfortunately the transition has not been so smooth for most other staff, if only because OS X is entirely alien to them, and because of this, the entire process has been frustrating and bewildering.

Bit by bit, through workshops and informal chats, I, and a very few other colleagues, hope to help those digital immigrants among the staff who are having difficulty adjusting to the new landscape. Lucky for all of us, the students seem to have taken their difficulties in stride, and pulled themselves up by their own bootstraps.

Today was a real case in point.

I had prepared a vocabulary lesson, which usually works moderately well in the classroom, but during those vocabulary lessons, there is always a non-stop torrent of requests to "tell" what a word means, or "give just one example" of how to use such a word in a sentence. When you are working wih the sheer number of words that these students need to, just to get their vocabulary up to a semi-acceptable level, those requests quickly become overwhelming.

But today, using their new Macs, and the slick (and beautiful, oh praise the Lord, it is!) Dictionary program that comes with the system, combined with Google's translate service, it was like I had become a mute accessory in the room.

They didn't even need me.

FInding the definition, writing down the Arabic translation, the part of speech, and creating a sample sentence for each word, now that they had the right tools, became doable tasks that kept them entirely engaged, and quiet.

It felt like I was in the Twilight Zone, for sure, but the truth is that, as long as ways can be found to use these new tools properly, the classrooms in thsi school will be unlike anything else in the UAE.