... in crisis

Why the U.S is and will remain miles (sic!) ahead of europe.

If you want to understand this you simply have to listen to the below excerpt from a planet money interview with Mark Zandi the chief economist of Moody’s Analytics and contrast that with the petit bourgeois, xenophobic attitude towards immigration that is prevailing in Europe:

and again, fundamentally we are fine. we can’t loose the sight of what makes our economy really tick though and that is: the most educated population, the best infrastructure and most importantly of all that we continue to attract the best and brightest from all over the planet, because as long as we can do that we are gonna be just fine.

Looking at the crisis from inside the belly of the beast

One of the more notorious/famous places in São Paulo is the boutique department store (Villa) Daslu. According to wikipedia ‘the boutique is known as the ‘fashion designers mecca’ of Brazil as it houses more than 60 labels plus 30 store-in-stores and is the place where Brazilian socialites, ranging from multi-millionaire soccer players to conglomerate bigwigs shop for the latest accessories and clothing’. Leged has it that Daslu is the only department store in the world where you can also buy helicopters (although that seems to be a bit of an exaggeration, in reality you can (could?) buy fractual ownership in helicopters operated by HeliSoultions) though the store.

Yesterday Kai and I decided to pay a visit to Villa Daslu to have a look at this icon of Brazilian upper class lifestyle. To our surprise/disappointment/excitement we found relatively little of the expected abundance. Instead large parts of the building stood empty looking as if they had been hastily abandoned and the few shoppers to be seen were easily outnumbered by the staff.

Large sections of the 2nd and the 3rd floor as well as some of the showrooms on the 1st and the 4th floor (including former Chanel, Gucci, Dolce & Gabana outlets) were completely empty, with all merchandise and most of the display-furniture missing. Strangely the management of the store did not even try to hide these empty spaces (one employe told us that they were ‘changing the concept of the store’ but in the absence of any sign of construction this seemed a bit implausible). As a result we were more or less free to stroll though the deserted parts of the building and take pictures of the emptiness (more pictures in this flickr set):

Moving through this half deserted temple of luxury shopping was easily one of the most surreal experiences i have ever had. This was reinforced by the fact that in other parts of the building the staff carried on as if everything was completely normal.

While i would certainly hope that this situation is illustrative of the effects of the economic crisis on the über-posh lifestyle of the Brazilian upper class this is probably not the case (it seems that the herd has simply moved to other pastures on the other side of the river). Instead it appears to be more likely that this situation is the result of the recent legal troubles of Eliana Tranchesi, owner and founder of Daslu who was recently sentenced to 94 years in prison and fined €434 million for tax fraud and smuggling. Apparently the aftermath of this verdict is slowly eating away this once iconic symbol of São Paulo’s immense economic inequality from the inside.

Bonus: one other option that i had considered for spending queens-day was to make a quick one day trip to brasilia (inspired by these incredible photos of the construction of brasilia by Marcel Gautherot). guess that will have to wait until next time…

Update (23.04.2012): The January 2012 edition of Time Out São Paulo contains a short article about the demise of Daslu (‘Death of a showroom‘) that uses two of the photos i took during my visit.

What goes up must go down [dubai edition]

09 Feb 2009 | 404 words | crisis migration emirates

Patrice just pointed (via the sarai reader list) to a fascinating little read about the impact of the cirsis in Dubai. Seems like lots of (primarily British) expats are secretly levaing the country in fear of being jailed for not being able to pay the debts amassed by their bloated lifestyles of the past years. As a result the parking lots arround DXB are becoming clogged with abandoned cars:

[…] Now, faced with crippling debts as a result of their high living and Dubai’s fading fortunes, many expatriates are abandoning their cars at the airport and fleeing home rather than risk jail for defaulting on loans.

Police have found more than 3,000 cars outside Dubai’s international airport in recent months. Most of the cars – four-wheel drives, saloons and “a few” Mercedes – had keys left in the ignition.

Some had used-to-the-limit credit cards in the glove box. Others had notes of apology attached to the windscreen. […]

Under Sharia, which prevails in Dubai, the punishment for defaulting on a debt is severe. Bouncing a check, for example, is punishable with jail. Those who flee the emirate are known as skips. […] [Sonia Verma in the Times online]

Make sure to also have a look at the comment section of this article as they contain a fascinating exchange between devastated expats who where ‘forced’ to leave the Emirates and Pakistanis who see this whole scenario as revenge for the hyper exploitation that characterized the boom years of the past:

Abdul Razaak, Karachi, Pakistan: Built on the sweat, blood n tears of Pakistani, Indian n Bangladeshi construction workers, this land of the rich treated us like mules n made us live in inhumane conditions for far too long. Allaah’s justice is served. How the mighty have washed away in the very sweat, blood n tears of the meek.

Tim, Cairo, Egypt: I worked in Dubai for many years and left last year with outstanding debts that I struggle still to pay. The Dubai system only helped people get into debt, there is no support to get out in a humane way.

BLDGBLG links to another article that attributes most of the abandoned cars to former owners from India, Sri Lanka, Bangladesh and other South Asian countries, implying that the burst of the bubble is not only hurting British fortune seekers but also South East Asian migrants that made up the bulk of Dubai’s working class.

meanwhile... is the personal weblog of Paul Keller. I am currently policy director at Open Future and President of the COMMUNIA Association for the Public Domain. This weblog is largely inactive but contains an archive of posts (mixing both work and personal) going back to 2005.

I also maintain a collection of cards from African mediums (which is the reason for the domain name), a collection of photos on flickr and a website collecting my professional writings and appearances.

Other things that i have made online: