This might actually be bigger news than what Tiger Woods and his penis have been up to. What it could mean:
You have to remember that the Great Depression only became “great,” that is, global, when an obscure Austrian bank went under in 1931, and set off a massive financial explosion around Europe. Capitalism is an irrational system that is often full of unpleasant surprises. The collapse of Dubai World may turn out to be nothing. But it could also turn out be one of those unpleasant surprises.What it definitely means:
The complexities involved in modern finance sometimes make what is going on seem inscrutable and hard to understand. Economists consequently argue endlessly about the real causes of the global financial crash in language that they layman has a difficult time deciphering. But when you look more closely at the flashpoints of disaster, whether in Dubai or in New York, the real problems seem to be caused by bad decisions by stubborn executives, whether blinded by greed or stupidity or the satisfaction of excess.And here's a big number to noodle: Dubai's exposure ($59 billion) is less than 1/10th of Lehman's ($600 billion) at the time the investment bank collapsed. Jeebus.
