An imminent debt default in Dubai looks unlikely at this time. Expect stock and commodity market rallies to continue through end of year. Use all rallies to sell into–liquidate securities and commodities as markets rally. Signs of deflation–where prices go down rather than up– should be much more prevalent in 2010. Commercial real estate refinancing should be more difficult as real estate pricing and defaults are feared. Credit contraction–less lending by financial institutions–should continue and make an economic recovery more difficult.
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