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Dubai crisis will not spread, says Invesco’s Garnick
Dubai’s financial problems have spooked investors around the world. Moody’s Investors Service didn’t help matters on Wednesday when it said it would review the ratings of not just of Dubai, but of neighboring emirate Abu Dhabi and the federal government of the seven-member United Arab Emirates federation. Dubai and Abu Dhabi are both part of the UAE, the world’s third-largest oil exporter.
But Invesco’s sassy market watcher, Diane Garnick, says the crisis isn’t likely to spread. Based on her past visits to Dubai, which she dubs a “Las Vegas-wannabe,” she expects little fall-out for other world markets.
“The one thing that Dubai completely aced about Las Vegas is that what happens in Dubai stays in Dubai,” she said during an interview at the Reuters Investment Outlook Summit in New York. “This crisis won’t spread.”
Investors should have been wary of Dubai all along, she added, since the hotel construction boom was built without enough other attractions to pull in tourists. “It’s like a tour of different hotels — that’s all it is,” says Garnick, who’s based in New York. Atlanta-based Invesco oversees about $419 billion for retail investors and institutions.