It has almost become legend in London Underground parlance, “mind the gap”, meaning that commuters should move with caution as they enter the train to avoid an accident on the platform.

This phrase “mind the gap” applies as well with what we are dealing with in Dubai and the UAE overall. Comments, many complain, have tended to be either inconsistent on the one hand or contradictory on the other.

That again was the experience in the last 48 hours, when the central bank of the UAE said it would offer liquidity to the banking system to all domestic and foreign banks with operations in the Emirates. The move was designed to avoid a run on institutions by depositors and guarantee there are ample funds available if the need arises. It went over well and indeed there was no panic.

Twenty-four hours later, we were on the receiving end of a statement by a hitherto unknown official from the Dubai Department of Finance Abudulrahman al Saleh who said the investors and lenders may have to shoulder the responsibility of their actions.

To be precise, he noted that Dubai World “was set up on a commercial basis and not guaranteed by the government.” The statement was crystal clear, that buyers or in this case lenders should beware. Nothing wrong with that approach if it is telegraphed in advance, but in this case -– having spoken to a number of bankers and others involved in the process –- it was not. This, one London veteran of the Middle East said, “is not the way to rebuild confidence.”

When covering the region one learns to put various pieces of the puzzle together by working the phones, talking face-to-face over a coffee and then completing the picture. In this instance we are not there yet. Some would contend we are still a way off.

The chairman of the Supreme Fiscal Committee of Dubai and Chairman of Emirates Airlines, Sheikh Ahmed bin Saeed al Maktoum is the man calling the shots right now as he and his team comb through the assets of Dubai World and the other “Dubai Inc.” entities. The people I spoke to over the last 72 hours expect more clarity by Wednesday.

In the meantime, bankers who have lent an estimated $123 billion to the UAE overall, 70 percent of that from European banks, might feel they too need to mind the gap.

The old adage, “timing is everything” certainly rings true with the request by the Dubai Government for a standstill on payments by Dubai World for a period of a half year.

Investor confidence in Dubai, exemplified by developments like the palm islands, has been shaken.

As timing goes, it was curious at best, coming just before the Eid el Adha holidays in the region and the long Thanksgiving break in the United States. Adding to the intrigue is that Dubai successfully raised $5 billion in a bond offering taken up by two Abu Dhabi government controlled banks the same day

This left investors scratching their heads wondering what the motivation was. I spoke to a number of fund managers and bankers with investments in the Emirate and, like most politics in the region, there is more to it than meets the eye.

As one fund manager said,  Sheikh Mohammed bin Rashid Al Maktoum, the Ruler of Dubai and Prime Minister of the UAE, is playing hardball. He is out to “teach a lessons to his boys.” His “boys” are the names which have become well-known power brokers in the build up of Dubai Inc. over the past two decades.

It has been a busy week for Dubai Inc.

Sheikh Mohammed cleared out his advisory board at the Investment Corporation of Dubai and pushed out the respected head of the Dubai International Financial Center who also served as Vice Governor of the UAE Central Bank.

The names on his advisory board included Sultan Bin Sulayem the Chairman of Dubai World and its property arm Nakheel. This I am certain was not an easy move by the Ruler.

Dubai’s rapid development was closely linked to the Palm and World property developments. I am sure we have all looked at their images offshore on Google earth at least once. Dubai World was also the force behind the high profile dust up in Washington with the P&O ports buyout.

Many I spoke to believe Dubai World is being singled out for good reason. Of the total $80 billion debt on the books, $59 billion of that comes under its leaky umbrella.

In fact, others within Sheikh Mohammed’s inner circle seemed to think it is only right for Dubai World to clean up their books like everyone else has been asked to do. That task is underway today with the help of accountancy firm Deloitte.

The other question being raised amongst global investors is the level of bench strength for Sheikh Mohammed or who he is turning to during this shake-up. Names at the forefront today include Mohammed Ibrahim Al Shaibani, Director-General of Dubai Ruler's court and Ahmed Humaid Al Tayer, Governor of the Dubai International Financial Centre.

They were in Sheikh Mohammed's delegation during this week’s visit to London and the response to their moves has been positive so far, according to bankers and investors I spoke with.

There is a sense of irony after what has gone on this week. British Prime Minister Gordon Brown congratulated the Dubai ruler for the actions taken to respond to the debt challenges during the bi-lateral meeting. It is something the PM knows a great deal about, with U.K. government debt soaring to 12 percent of GDP.

That nod of goodwill came before Dubai’s request for a standstill agreement, and left investors wondering what is next.  As one regional economist said this was a “disappointment in a way.” Dubai Inc. had cleared all the hurdles on the path to recovery but appears to have stumbled on this one.

The Dubai Air Show was not a glamorous affair.  When one points to regional orders from Algeria and Ethiopia to mark the highlights for 2009, there is a slight disappointment to be candid.  The total tally tells a similar story, some $5 billion of firm placements vis-à-vis $155 billion from just two years ago.

In comparison to the state of the industry in Europe or America today, the result however was impressive.  We interviewed the CEO of low cost carrier Jazeera of Kuwait and asked him why profits were down 53 percent over the same period last year.  The German executive Stefan Pichler replied in a matter fact fashion: at least we are still making money.

I believe it serves as a good microcosm for the region in general as it searches for the bottom of the crisis.  Businesses are not witnessing runaway growth, but they do see light at the end of the tunnel.  For example, the big brand carriers in the region, Emirates, Ethiad and Qatar are not cutting back their original commitments, only stretching them out if necessary.  It is worth noting that the carriers seem less concerned about posting profits right now, but building out their brands and their market share.

With oil trading around $80 the scope to build off the foundation recently put down is there.  Sheikh Ahmed bin Saeed Al-Maktoum chairman of Dubai’s Supreme Fiscal Committee and Emirates Airline told us that the second half of the $20 billion government bond package should come by the close of the year.  If so, and if there are buyers beyond the UAE central bank, it will be an important indicator.
 
I chaired a forum of business leaders in London this week and found that most believe a firm floor is being put on this economic recovery in Europe as well.  Germany, France and Italy are growing again, albeit all below one percent in the last quarter.  Spain and the U.K., both overly dependent on the property sector, are suffering under the weight of their budget deficits.  It is a similar script being written in the United States. 

But there was categorically a belief there won’t be any hidden surprises, with an important caveat that policymakers may be already planting the seeds of the next financial crisis – in sum too much money thrown at the banking system that will eventually fuel inflation.

Meanwhile, the energy surpluses continue to fuel investments on European soil.  The relatively new investment arm in Abu Dhabi is moving swiftly post-F1 to raise its profile, buying Brawn Grand Prix with partner Daimler.  It also plans to raise its stake in the German industrial group to 15 percent.

Qatar is choosing to continue its investment advances in London.  There is active talk the QIA wants to raise its stake in grocery chain J. Sainsbury and after the Americans leave the posh neighborhood of Mayfair, Qatar will take ownership of the current site of the U.S. Embassy.

These investments may not raise the GDP figures in either Germany or the U.K. but do help us in our search for the bottom.

After only a year on the ground in Europe as a young twenty-something correspondent, I was thrust into coverage that one knew was not only historic but would have grand implications for years and even decades to come.

I landed in Berlin two days after the fall of the Wall, but was fortunate enough to cover the IMF/World Bank meetings the year before in the same city.  While the institutions are often criticized for not having their finger on the pulse, in this case they were well ahead of the curve on how events were going to unfold.

During those meetings, I ventured over to East Berlin to experience for myself the impact of the communist led economy.  On countless occasions I was approached with whispers in my ears to swap dollars for East German marks on the black market.  Border guards snapped photos of western visitors like me for their files knowing full well that this cat and mouse game was drawing to a close.  One could only describe the experience as grey – from the look on East German faces to the buildings themselves.  

That visit helped me draw a clearer “before and after” picture.  Immediately after the Wall fell, West Germans embraced their neighbors, welcoming them in from the cold.  That euphoria quickly faded when it came to paying the bill for reconstruction, welfare payments and years of double digit unemployment.

The political impact of the fall of communism has been well documented, but what has often been left out of the discussion is the economic domino effect that it triggered.  First and foremost, East Germans were not willing to accept the original 5-1 exchange rate for their currency, nor the 3-1 that was quickly offered.  They demanded parity and within two short weeks received it from German Chancellor Helmut Kohl.  The move cost a fortune (an extra $50 billion) but in an historic context, the Chancellor made the right call.

Events were transforming so quickly, governments had difficulty keeping pace with change: German monetary union, the first all-German elections and fast on its heels the creation of the European single market – project EC (for European Commission)
1992. 

Perhaps because we have the benefit of hindsight and experience, the leaders two decades ago seemed much better equipped, despite fears then of German dominance.  Chancellor Kohl, Francois Mitterrand and Margaret Thatcher were the forces to be reckoned with.  They were pushed and prodded along by European Commission President Jacques Delors who drafted up the blueprint for greater expansion of the EU. 

They were thinking big at the time, you could sense that from the summits we covered.  Despite internal fears and haggling that took place, they eventually delivered on their promises.  The Euro is now a major force in global currency markets; the EU is home is 27 countries (albeit with a tinge of expansion fatigue) and it is a market of a half billion consumers. 

Have reforms happened fast enough?  The answer is clearly no.  Is there an issue of illegal immigrants flooding in still through Eastern and Southern Europe?  Ask those who live in Malta, Spain, Greece and Italy.  And are the more mature economies of Europe adapting to increased competition after the lowering of trade barriers?  Candidly no.

But if one takes a step back, many who doubted the decisions in 1989 and the years to follow must now say the European response and development post the fall of communism has been much more successful than originally thought, minus the labor reforms which today still hold back opportunities for the next generation.

Warren Buffett voted with his pocketbook this past week, investing $26 billion to purchase Burlington Northern Santa Fe. It is one of America’s oldest railroad networks and the backbone that helped build the country. 

The Oracle of Omaha - as Buffett is fondly referred to due to his Mid-Western roots in Nebraska - is also big on animal instinct.  The concept is simple: we all need to be aware to both survive and smell opportunity when it beckons.

In that spirit, Buffett is probably letting economists debate the merits of whether this is a V shaped recovery, a sharp downturn and straight line back to growth or a recovery that reflects a W, where the economy recovers, dips and bounces up and down for a few years. 

Maybe I am a child of the 1960s, but my fond recollection of those letters has more to do with the VW Beatle that headed to the beaches of California, not illustrations to guide economics.

In October, my three visits to the Middle East, which included Dubai, Qatar and Abu Dhabi during the Formula One festivities and the launch of our regional hub in the UAE capital, led me to put aside traditional economic research. 

Instead, I relied entirely on animal instincts and, going back to my Greek roots, I used the agora to get the latest reading of what was happening.  Bankers confidently said that the road show to raise $6.5 billion in Dubai would be well received.  The first portion of that offering was three times oversubscribed.

Businessmen noted that they felt the worst was over in the local property market and that foreign buyers had started to show interest again.  Colliers International released figures this week indicating that prices rose 7 percent in the third quarter, although they are down 47 percent on the year.  Again, the figure does point to a bottom being reached.

In Qatar, despite the bottom following out of the natural gas market (trading one-fourth the equivalent of crude prices right now), the economy is hardly suffering amid the “recession” as growth has reached 8.5 percent this year.  The greatest challenge is completing projects on time and allowing the market to catch up with all the construction.   

Finally, the Formula One race looks to be only a starting point for Abu Dhabi. I was surprised enough at the $40 billion officially spent to build up Yas Island and the infrastructure around it to host the circuit.  According to Economy Minister Sultan bin Saeed al Mansouri that is only the beginning.

He says that the Yas Marina complex will be a blueprint for future developments with an eventual commitment of $1 trillion dollars - for roads, power plants and rail links.  That is an eye-popping number that others within the government were, shall we say, shy to commit to, but it does give a sense of how the old economy will help build the new one and how the future won’t be measured by a V or a W in the region.

LONDON, England - When it comes to the number three, there are two conflicting philosophies: The first says everything comes in threes, the second says third time lucky (or unlucky.) This weekend the G-20 leaders have been meeting for their third meeting in a year.

G-20 leaders are all smiles, but for how much longer will the unity last.

For an organization that had never met before at heads of state or government level, this is something of an achievement. But then rarely have they had to ride to the rescue of the global economy that was about to collapse.

Twice before when they met, they agreed to halt the blame game of how we got into this mess. They worked together to get us out of it. This was no mean feat since it involves countries from communist China to capitalist America and all shades of political persuasion in-between. Their ability to coordinate and cooperate has been noted time and again as one of the great advances in summitry.

In Washington last October, they ignored the fact President George W. Bush would be out of office within months and built a plan, calling it "The Washington Action Plan." By the London meeting at the beginning of this year, trillions of dollars had been spent and the leaders met to coordinate how their posh-sounding plan was performing. They tinkered and tweaked and gave some more money to the IMF and carried on cooperating. They didn’t have any other choice. Now, with Asia decoupled from U.S. and European growth, what next?

Everyone agrees it is too soon to take away the stimulus that is keeping developed economies afloat. Everyone agrees that they will have to coordinate their exit strategies when that time arrives. Oh yes, they even agree banks need to have some strict reform of the rules (and, yes, that includes big bad bonuses.) This is all done on the basis that "we are not letting this happen again."

But the issue is whether they can keep agreeing. France, for instance, is keener on stricter regulatory reform than, say, the UK. Britain has much to lose if Europe’s financial headquarters, the City of London, becomes over-regulated. French Finance Minister Christine Lagarde told me that restricting bankers’ bonuses was a symbolic way of proving no more business as usual. Only by imposing discipline and regulatory systems could we reign in the financial world, she said. Such a view of course, is very much at odds with what might be expressed in Washington.

The G-20 now finds itself rather like a group of passengers who have just been rescued from a sinking ocean liner. When facing disaster, all classes from captain’s table to steerage, share laughter, friendship and love. Now as the good will of rescue starts to disappear, old rivalries resurface and political ideologies put to one side are restored.

Which brings me back to my first point. Can the G-20 hold it together for a third time? They probably will, simply because this crisis is not over yet. Longer term, as the G-20 presidency passes from the UK to South Korea, the axis of power shifts. Well, I have more doubts.

Crises breed cooperation. Recovery may well breed resentment. Even if the third summit works, don’t bank on success for the fourth and beyond.

LONDON, England - Wherever you live, there’s always a local oddity or two: uniquely strange driving habits on the roads, maybe, or fast-selling products whose actual use is obscure. Here in England, it’s the strange phenomenon of the fiver famine.

The fiver, let me explain, is our smallest banknote, both in size and value: the five pound note. You would have thought they’d be common – not exactly two-a-penny, but fairly easy to find.

Er … no. The fiver is a rare bird which only occasionally flits across one’s path in its gray-green plumage, whereas its plumper companion, the £10 note or tenner, a classic brown job, flies out of cash dispensers with great regularity.

And here’s the second oddity: when your patience pays off and you do track the rare fiver bird down, it’s usually in a sorry bedraggled state.

People here were quick to embrace credit cards and then debit cards, and the old-fashioned cheque is still around in the background, no doubt still recovering from the excitement of its 350th birthday party earlier this year.

But the shortage of handy fivers is a nuisance for people who are forced to use a lot of cash, like market traders and taxi drivers. I’m not saying they’d change a tenner for a fiver just to make life more convenient, but they dislike having to give their customers a clunking great pile of our weighty little £1 coins rather than a handy banknote.

Talk to the Bank of England or the Payments Council, which monitors all kinds of payment on behalf of retailers, and they look in all directions and usher you into a private room before revealing a dirty secret about us Brits: we abuse our banknotes.

I’m serious. Those big denominations get treated with respect, of course: the average £50 notes can look forward to a decade of pampered life, lovingly tucked into fat wallets or squirreled carefully away in safes. By contrast, a tenner might last only a year or two, while the unfortunate fiver is treated as small change and handled accordingly: scrumpled up into a ball, stuffed into pockets next to bunches of keys, put through the washing machine, and generally viewed with scant respect.

So as fast as the Bank of England issues nice fresh notes, they’re soon transformed into limp dog-eared little rags that are simply not crisp enough to put through the machinery that counts banknotes. That means they have to be weeded out, and banks generally prefer to save themselves the trouble and cost involved.

That means fivers aren’t available from cash dispensers (with exceptions; I was intrigued to be issued with £5 notes when withdrawing money on a recent visit to Liverpool). Given that nearly two-thirds of the cash withdrawn in the UK comes out of those holes in the wall, the result is a shortage.

Just to tighten the vicious circle, retailers generally don’t even bother to bank the fivers they accumulate. So even if the banks could put them into cash dispensers, they’d be short of them anyway.

So while it’s tempting to think that this is all down to the recession here and our wanting to spend less and take out smaller denomination banknotes, it’s really all about printing more of the kind of money we like to use most.

Now the retail banks and the Bank of England are working together to address that. For a couple of months now they have been running a pilot centred on Central and Southwest England.

It’s too early to say whether this will mean more fivers everywhere; I personally fear a lot of banknote printing machines will burn out as the Bank of England tries to cope with the fiver famine and the need to pump cash into the financial system.

For the past 12 years, some 50 of Europe’s top corporate leaders have been under special surveillance.

Wendelin Wiedeking's time at the head of Porsche has come to an end.

This has nothing to do with this week’s revelation that Frankfurt state prosecutors are deciding whether to bring criminal charges as they investigate allegations of illegal tactics by private detectives on contract to Deutsche Bank – though that mighty bank’s former CEO and Chairman, Rolf Breuer, is among the names being watched.

In 1997 and 1998 I was part of a CNN team that made some 50 programmes about individual company bosses in a series called “Pinnacle Europe.” We spent at least a day with each one, talking to them about how they’d got to the top, what they’d done for their companies, how they planned to stay ahead and what they did outside the office.

The series producer, Jeff Nathenson, and I still regularly exchange banter about what has happened to each of the CEOs we profiled; he maintains there is a “curse of Pinnacle” that gradually topples them, one by one. So we continue our casual surveillance of all 50 – by the boringly legal method of watching the headlines, I should add.

The fact is, though, that many are now ex-bosses. Many crashed and burned; they fell victim to boardroom knife attacks and are spending more time with their families. Some, like Jorma Ollila of Nokia, completed their distinguished careers and moved on to even higher things. Others sold their companies.

A handful have survived. Sir Richard Branson is still running Virgin in his unique way and is even wealthier than he was in 1997; Daniel Vasella is still atop the Swiss pharmaceuticals company Novartis; and Klaus Schwab is still head of the World Economic Forum.

But today one name did fall victim to Jeff Nathenson’s putative “curse of Pinnacle.” Germany woke up this morning to learn that one of its corporate titans, Wendelin Wiedeking, had been ousted as boss of Porsche, the role in which I had interviewed him for our CNN profile early in 1998, and which he had held for a very successful five years before that. With Wiedeking and his impressive collection of model cars evicted from the Porsche headquarters, talks are now underway to bring about a merger of the sports car maker and Volkswagen.

Dr Wiedeking had sought exactly the same thing, but in a different format. Having rescued Porsche from the weak dollar of the early 1990s (US sales are crucial to the company), he launched new models, shifted some production out of Germany and made the Stuttgart-based icon one of the jewels of its sector: prestigious and profitable.

Money piled up at the bank – and in the CEO’s personal wallet. His contract awarded him 0.9% of Porsche’s pre-tax earnings, a bonus reported at some 77 million euros in 2007-08. Confident in his ability to run any car company, even Europe’s largest, Wiedeking set his sights on a takeover of Volkswagen.

That proved his undoing. Like the Icarus of myth, this high-flier had ventured too close to the sun. True, Porsche amassed more than half of VW’s shares and had options on a further 20 percent. But it had also run up $14.2 billion in debt, and as the credit crunch bore down on big corporate borrowers, that burden crushed the life out of his ambitions.

Family politics also played a part. Porsche and Volkswagen have always been intertwined. Before World War II, Ferdinand Porsche designed the original Volkswagen or “People’s Car” – the evergreen Beetle. When the War was over he built his first Porsche model in a shed up an Austrian mountain, shifting production to Stuttgart when his sports cars started selling in big numbers.

Ferdinand Porsche’s descendants still control the company he founded – but one of his grandsons is the redoubtable Ferdinand Piëch, the Austrian former Volkswagen CEO, now its chairman. Wiedeking’s designs on VW split the extended family, and made an enemy of Piëch, a man not to be crossed.

History will shake its head at the ill-fated ambitions of Wendelin Wiedeking, while admiring the way he rescued Porsche, and that neat clause in his contract which rewarded him so handsomely for genuine, measurable success.

But why am I writing him off? He still has some interesting directorships – Novartis, for example. He has no need of money, even giving half his $70 million pay-off to charity, but driven people like that don’t just retire to the golf course. They waste no time in passing out their telephone numbers to the head-hunters.

There aren’t that many executives who can say they’ve rescued a major car company once before and left it wonderfully profitable, and these days those qualifications are badly needed. Like, who’s going to run Opel once it’s been sold off by GM?

NEW YORK – Disgraced financier Bernie Madoff stood up in court in New York on Monday and told some of his victims that "I live in a tormented state for all the pain and suffering I created."

Miriam Siegman’s life has been turned upside down by Madoff’s crimes.

Facing them head on, he said he was sorry - but his words rang hollow.

Speaking to us just after the sentence was handed down, many victims said if Madoff was truly sorry he would have stopped years ago and owned up to his mistakes instead of living a life of luxury.

Others felt bitter that Madoff has not told prosecutors who else was involved and where any remaining money might be hidden.

Victims, who attended a rally after the hearing, are vowing to fight on.

But many acknowledge they will never recoup their life's savings.

One woman, Miriam Siegman teared up as she told how she now lives on food stamps.

She admitted she turned and walked out of the court room when Madoff gave his statement. It was simply too little, too late.

The 150 year sentence Madoff received was the maximum allowed and was based on several factors including the number of victims, the amount of money involved and the damage caused by his acts.

In delivering the sentence the judge said he understood the ruling was largely symbolic since, at age 71, anything over 15 years would likely mean life in jail for Madoff.

But Judge Denny Chin said he wanted to send a strong message to those who would think about perpetrating similar crimes.

This is by far one of the harshest sentences ever handed down for white collar crime in the U.S., but Madoff's crime was unprecedented and has badly damaged investor confidence.

What do you think? Did Madoff get what he deserved or is 150 years overkill? Did he act alone or will the government be successful in charging any accomplices? And will the harsh punishment deter others?

NEW YORK - “I’m at a point in my life where I was not opening envelopes ... I was not looking at stuff and I need to make a decision to be active in my life.”

Sound familiar? It did to me. The quote is from a woman attending a seminar I sat in on as part of our Road to Recovery coverage.

Each week about 30 women gather to participate in a class that is designed to help them regain control of their financial lives. It is a bit like weight watchers, but in this case they are counting coins, not calories.

As I listened to their stories, I felt an immediate connection. I also have a pile of statements about my retirement funds that I have been too busy – and secretly too stressed – to look at!

It turns out that many of us are carrying around the dirty secret that we are not nearly as informed about our finances as we should ... or certainly could be.

Gallia Icon is out to change that. A personal finance advisor, she and her co-instructor M.P. Dunleavy started these weekly money classes to help give women a basic education in personal finance.

The courses, which last for 12 weeks, are set-up like a support group – complete with weekly check-ins. The women set concrete goals at the start of the course and then give updates each week on the progress they are making.

The dozen or so ladies we visited came from very different backgrounds but they had one thing in common: For too long they had let other people make decisions about their money.

"Women, in particular, do not make money a priority and tend to let partners handle much of the responsibility. If they are taking care of the household finances it is usually rushed at 10 p.m. at night after they are done working and have put the kids down for the night," says Gichon.

The classes cover everything from understanding mutual funds to saving strategies to wills and life insurance. In the sessions no question is off limits. Participants say the female-only format helps keep the conversation free and open.

I went in not knowing what to expect, but I left inspired. After putting up pretenses for years, these women were ready to bare all. They asked detailed questions and offered each other support and information.

After just a couple of classes, many had already made big changes. One woman had started reviewing her retirement program at work and making changes to her fund allocation. Another had paid down debt and was ready to invest for the first time.

And – my favorite – had moved all her information online and was getting ready to sack her current adviser whom she felt had always talked down to her!

In this tough economy it is easy to ignore this part of life and hope the problems just go away, but they rarely do. These women show that with a little instruction and the support of your peers you can regain control and banish that nagging voice that has been telling you could do better when it comes to your money.