Tag: Dubai

Gold or Dollars?

Is Gold Really A Superior Investment?

I’m sure you’ve heard about the steady rise in gold prices over the last several months. You may have also seen the advertisements from gold investment companies pushing the purchase of gold, or heard predictions about even higher gold prices as world currencies struggle.

And just yesterday, the world’s first “Gold ATM” machine was unveiled in Abu Dhabi (Gold ATM Machine, Financial Times).

Gold dispensing machine in Abu Dhabi

We have to take a step back and ask ourselves about the true underlying value of gold.

Why is it valuable?  Because people demand it, and there is a relatively limited world supply.  Why do people demand gold?

It’s not like gold will sustain you: you can’t eat or drink it, nor does it have utility in and of itself.

No, the reason gold has value is because it can be exchanged for money which, in turn, can be exchanged for goods or services.  So the value of gold is derived from the very same place as is the value of money:  access to underlying goods and services.

The actual value of gold, however, is entirely dependent on other people’s demand for gold, given limited supply, much like fine art.  Unlike money, you cannot actually use gold for transactions:  have you tried to use a bar of gold at your local restaurant or car dealer, for example?

Think about it: if for some reason gold fell out of favor — let’s say someone discovered it was toxic — then gold would no longer be desired as an indirect means of exchange — having to first be exchanged for currency — and its price would drop to nothing, quite independently of the value of money itself.

The value of money it also dependent on its demand, which in turn depends on the acceptability of the currency on the world stage as a unit of exchange.

Dollars are accepted as currency and retain their value as long as the underlying real U.S. economy continues to be productive, and as long as the world supply of dollars does not outstrip the world demand for dollars.

Gold bars

Dollars are suffering at the moment for two primary reasons:  the attack on private industry by Obama’s policies, and the excessive world supply of dollars.  Both of these factors drive down the value of a dollar, and drive up the number of dollars that a bar of gold commands.

by Sherry Jarrell

Brief encounter

A gift from one stranger to another

I was waiting for a flight to London one day in January, a spare seat opposite me at the table in the lounge.

A middle-aged German woman asked to sit down. She was she stopping briefly in Dubai on her way back from Australia and it seemed from the conversation that her month long trip had been some sort of possible life changing experience. By her simple back pack and even her shoes I could tell she was an individual with character.

In the minutes that passed by she talked about Tasmania and how different life was there from the one she knew at home.  I don’t recall exactly what I said to share the pleasure of her trip but did agree that it was possible to make major changes in one’s life; it obviously struck a chord.

Not so long after this brief meeting, I received an email.  She had made those big changes and she sent me a picture that she took in Tasmania as a thank you.

A Tasmanian bird greeting the morning sun

You never know how sometimes people just need someone who can see that their dreams are possible!

By Bob Derham

The Mystery of the Disappearing Ethics

The Dubai debt crisis raises fundamental questions.


UK banks account for half the £60billion of global loans to the debt-laden emirate, new statistics show.

Well done British banks ….. loads of loans built on sand … I suppose the words “conservative” and “prudent” didn’t get printed in the Banking Terminology dictionary?

So Britain, that Global Giant of the banking world, has half the dodgy loans? British banks are therefore as daft as the rest of the world put together? (Can someone check my maths!)

Oh, and why exactly were the banks lending money to SORDID DICTATORSHIPS? Would we have lent billions to Hitler’s Germany in 1937? What on earth happened to ETHICS in the financial world? I suppose lending to POOR countries who need it rather than the nasty, venal, corrupt dictatorships of the Middle East was right off the radar?

There is an obsession with the “Human Rights” of immigrants and others in Britain, but a complete and utter turning of  blind eyes to the slavery going on in the Middle East, as if it doesn’t concern us because it’s in “another far-off country of which we know little”. (Neville Chamberlain’s shameful explanation of his inaction over Hitler’s annexation of the Sudetenland in Czechoslovakia in 1936.)

Sorry, but “No Man is an Island” …. we can’t sign the UN Declaration of Human Rights on the one hand and then blithely lend money (the PEOPLE’S money) to countries that are treating people so terribly.

I hope Dubai goes bankrupt and our cretinous banks with it so that we can start again with people’s banks that have a modicum of honour and decency and are prepared to invest in democracies, not insanely greedy property developments based on dictators’ idle fantasies.

It wasn’t much different with Sadaam Hussein, whatever you think of the invasion. This was a man who – just to take one example – gassed to death 5,000 innocent men, women and children in one single village alone. Yet countries in the “free world” were secretly queuing up to do deals with him. One British government MP even went there and shook his hand, the hand that consigned hundreds of thousands of people to a horrible death.

Ecology? Apart from anything else, Dubai’s carbon emissions are pro rata 250% higher than the US, so much power goes into air-conditioning and desalination. Once again, the left hand doesn’t know or care what the right hand is doing. A British minister tells us to stop eating meat to save the world while British banks simultaneously rush to finance a humongously-profligate and obscenely-elitist project in the desert.

I sometimes wonder if we really deserve to survive Global Warming. Will it be God’s way of cleansing the Earth of an aberrant experiment in free will?

By Chris Snuggs