Click here for a very scary read from former Wall Street Underground-er Nick Guarino. He says the falllout from the collapse of Dubai World has barely begun and that the final damages will vastly exceed the $60 billion currently estimated, sinking the global economy. This piece is not for the squeamish nor for gold bulls, who are not going to like its conclusions. When the “Dubai-has-been-saved” delusion ends and the world’s money managers panic, Guarino foresees a huge rally in Treasurys and the dollar, along with a corresponding collapse in gold and oil prices. The latter, he says, will fall to $5. Since we’ve already had a preview of how the markets will react when Dubai-induced panic hits, the only important question remaining to be answered is whether you think Dubai’s problems have been fully resolved.
