PBS Newshour Nov. 27, 2009--Dubai's Plan to Postpone Paying Debt Shakes World Economy:
JUDY WOODRUFF: World markets were thrown into turmoil today on news of financial trouble in the Persian Gulf city-state of Dubai. Dubai announced that it planned to put off repaying almost $60 billion dollars in debt owed to international banks.
That led to big losses in Asia, worries in Europe, and a rough day for stocks on Wall Street. The markets closed early for the holiday weekend. And the Dow Jones industrial average lost 154 points, to close above 10,309. The Nasdaq fell 37 points, to close at 2,138.
We begin our coverage with a report from Faisal Islam of Independent Television News.
FAISAL ISLAM: For a second day, the collapse of Dubai's property boom has been upsetting markets worldwide. Across Asia this morning, share prices tumbled again. Gold and oil dipped, as traders asked which banks might be exposed. British banks have made significant loans to the United Arab Emirates, of which Dubai is a part. The announcement on Wednesday that a state-owned property company wished to delay the repayment of billions of dollars of debt had raised fears of a new leg to the financial crisis.
The prime minister, visiting the Commonwealth summit in the Caribbean, tried to allay fears today.
Margaret Warner talks to economic expert Simon Johnson about how Dubai's weak economy will affect the rest of the world.
Full transcript here.