A stitch in time saves nine

Abu Dhabi announced today that it will fork over another $10 billion to Dubai. If this had been done a month ago it could have stopped the flight of foreign investment. Today I read an interesting parallel to the US: Freddie Mac and Fannie Mae were technically not backed by the US government, but had the US allowed them to default the result would have been catastrophic. The same appears to be true for Dubai. The difference is that the US stepped in early and Abu Dhabi waited until after Dubai announced it would default.

Now the expensive stitching may be too late to close the gaping hole.