How Dubai's burst bubble has left behind the last days of Rome | Hacker News Reader

How Dubai's burst bubble has left behind the last days of Rome

timesonline.co.uk

10 pointsedw5193 comments

What an overwrought headline. It's a pity some people are getting burned, but on the other hand those same people were expecting to make out like bandits on relatively cheap real estate built with cheap labor. It's not like the place is about to be overrun by barbarians or the like...by 2015 they'll probably be back on track and it wouldn't surprise me at all if the place is (financially) hot within a decade.

  and blest are those
  Whose blood and judgement are so well co-medled,
  That they are not a pipe for Fortune's finger
  To sound what stop she please

--Shakespeare

Prices rise and fall; durable institutions endure. It's easy for some liberal arts student to write a gloomy article poetically comparing a tall building to a needle bursting the bubble.

It's harder to really understand the economic and strategic drivers behind Dubai. I certainly don't.

My hunch is that Dubai is a durable institution. Specific players, like Dubai World, may perish or be mauled. But the buildings they left behind will probably endure, with tenancy rates and rents rising and falling as Fortune plays various tunes.

I'm sure the buildings will stick around. Detroit still has many of the buildings from its glory days.

They're pretty empty now though.

I have no doubt that Dubai will still exist as a city in the future. Rome is still a great city, after all, and Detroit is still one of the largest metropolises in the US. The question for Dubai is near-term trajectory. Do they maintain their economic relevance or does it continue to decay?

I think the most likely outcome is that Dubai will become a satellite city of Abu Dhabi, and the economic (and possibly political) activity of Dubai will increasingly become dependent upon that city.

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