Dubai crisis will not spread, says Invesco’s Garnick

dubaiDubai'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.

Soccer clubs and mortgages: How a media mogul spends $10 million

Unlike many of us, media executives know what it’s like to play around with large wads of cash. So it seemed natural to ask them about what kind of investment opportunities they’re seeing when they gathered in New York this week for the Reuters Global Media Summit.

We gave each media honcho $10 million in hypothetical cash and told them to put the money to work without buying stock in their own companies.

Diller11Some executives plowed the money into broad sectors and regions, like emerging markets, while others zeroed in on specific stocks, like Electronic Arts’ CEO John Riccitiello’s penchant for software maker Adobe.

Zynga CEO Mark Pincus said he already owns shares of privately-held Facebook, the Internet social network on which many of Zynga’s video games are designed to be played on, and that he’d buy more on the secondary markets (OK, so he creatively sidestepped the rule against investing in his own company).

And some media moguls seemed to have investment strategies driven by goals other than maximizing returns:

"I would put it in US-based international equities. I mean, if you said….If you forced me to invest a dollar."

(Reuters: You can put it in your pillow if you want.) That’s what I’ve been doing. Unfortunately, the pillow was unsleepable

-Barry Diller, CEO, IAC/InterActive Corp

"Pay off my mortgage in Nantucket. That's probably the safe answer with my wife."

- Mark Greenberg, CEO, Epix

"Leeds United (British soccer club) -- I've seen them recently and they could do with the money."

-John Ridding, CEO Financial Times

"I think having a good time, for the next five or six years."

-Mitch Lowe, President, Redbox

See what tech and media executives said in May 2009, December 2008 and May 2008.