Just as the smoke dissipated...

Just as the smoke started to dissipate...the fire was re-lit. A debt-laden Dubai state corporation, Dubai World, has suggested it may need to default on its interest bill.

The panic and uncertainty was fuelled by the fact that it a national holiday in the Middle East and USA, celebrating Eid and Thanksgiving respectively.

Shares plunged; weak currencies were hit; and £14 billion was lost by UK banks. Speculation and low confidence was not helped when a computer crash at the London Stock Exchange stopped trading for more than three hours (!)

However, it has to be noted that these debt of $80 billion are just chicken feed in comparison to bank bailouts. Therefore, if British Banks like HSBC and Standard Chartered did have to write off their loans, it would not dent their balance sheets beyond repair. What will be burnt to ashes is confidence: investment in Dubai could totally dry up.

Although this disaster has taken place in Dubai, there could be major repercussions around the world. Not only have British banks lent to businesses in the Gulf, but Dubai owns lots of assets in Britain - from part of the London Stock Exchange to Legoland to Travel Lodge.

For now we just have to hold our breath and wait for their emirate brother, Abu Dhabi, to put out the fire.

Fit for a hero?

Where are you based? "Airports around the world." Not a fugitive, not a homeless person or a lunatic; this was the response from Shirin Ebadi, a Nobel Peace Prize winner, who has campaigned against infringements of human rights in Iran.

A character of this calibre has been effectively "threatened with death" by the Iranian government because she is a prominent figure who continues to denounce the regime. Officials in Iran have beaten up her husband and brother telling them to mute Dr. Ebadi.

Dr. Ebadi has raised awareness of the recent alleged electoral fraud and fought against the brutality towards protestors, opponents and the plethora of other grave human rights abuses. They claim she is conspiring against the state.

The Recession's Winners

Sub-prime mortgages have been the catalyst for a disastrous recession: bank loans dried up; consumer confidence and demand plummeted; large and small firms went into liquidation; and unemployment is still rising.

However, for some companies, their adroitness has taken advantage of this recession. It was the most poignant moment of the recession when, one year today, Woolworth's crumbled - an unrivalled loss for customers and the high street. However, it left a gaping gap the market. Woolworth's held 14% of the market share for toys received. Those boots were quickly filled by competitors. Amongst many others, a notable beneficiary, was HMV who saw a rise in profits by 17%.

It is debatable how much of this rise can be attributed to competitors closing down: the government have pumped billions into the economy as part of the quantitative easing programme to bring liquidity to the markets, and thus increase lending and consumer demand.

Behind the Curtains: Secret Loans

Today the Bank of England revealed that it lent RBS and HBOS £61.6bn, in an attempt to rescue the banks, last autumn. The move was rightly done in order to "prevent a loss of confidence spreading through the financial system."

The country has been treated like little children. The shocking truth has been kept from us for so long.

However, these measures must be seen in context. The loans were given as a "lender of last resort" at the height of the panic, just two weeks after the collapse of Lehman Brothers.

The Bank of England also announced an increase in its quantitative easing programme to inject liquidity into the market, and thus encourage banks to loan responsibly to the public.

Not going up in an upturn.

We were told to worry about the recession. Now, worry about the upturn.

When it comes, it will not be as rosy as some might think. Just like unemployment, insolvencies are also a lagging economic indicator. Begbies Global Network, an insolvency firm, predicts an increase in insolvencies next year. This was the case after downturns in 1974, 1980 and 1990.

The biggest punch will be landed on small firms who risk a severe lack of working capital when they start growing again. This dilemma is exacerbated by the fact that there is very little competition between lenders. Foreign institutions have gone home and our domestic market is dominated by four banks. This is why the government refused to sell Northern Rock's lending assets to these banks.

Small firms do not have the best range of sources of finance. Apart from banks, their only saving grace is the government's loan guarantee scheme for enterprises.

In the upturn, they must hope for tax cuts - which is unlikely, considering our vast debts.

Pound Foolish

It is a truth universally known that climate change is happening now, and is inextricably linked to human activities. Carbon dioxide levels have sharply risen as we have industrialised over the last 300 years. In this context, it comes as a shocking, unwelcomed revelation that less than half the population believes that human activities are to blame for global warming, according to a poll from The Times.

The British public have proved to be foolish - but this also reveals a stark political failure. Politicians at Westminister have miserably failed to convey how serious our situation is. Until they achieve this, we have no chance of combating climate change. The fight against global warming is one that needs to start at grass-roots level: from switching off the lights to saving water to lobbying governments to change their ways.

The Wall fell, now the inequality needs to.

Yesterday, at the Brandenurg Gate, there was a sense of jubilation - that 20 years ago, Germans were audacious enough to hack the Berlin Wall down. When West Germany was unified with the East Germany, they were also unifying themselves with an economic mess.

In 2009, that mess has yet to be cleared. East Germany still depressingly lags behind West Germany. They are significantly poorer with high unemployment rates. There is still much work to be done.

When the Wall fell, inequality did not fall with it.