Where have more than half of the real estate projects been abandoned? You'd be surprise, but we're not even talking about the United States. We're talking about oil-rich Dubai.

Guess how Dubai got into such financial trouble? Yep, excess borrowing and over development. Does that sound familiar? Dubai is in such a bind that it had to borrow $10 billion from The United Arab Emirates. The loan will help Dubai to meet its financial obligations and continue its development program.

You read that right. Bloomberg.com has reported that The bank of England has lowered it's benchmark interest rate to it's lowest point since the bank was founded in 1694. How much more proof is needed to make obvious the fact that people and businesses just aren't borrowing money any more?

Even if some stalwart soul had the inclination to borrow some money, are there banks out there which are lending it? In the face of unemployment levels which some say honest calculations put up as high as 16%, banks are becoming adverse to lending money to anyone who might actually need it. Of course I can get you credit card applications all day long, if you're willing to pay upwards of 19% interest on new money.

So you have to wonder, when is it all going to break loose. Honestly folks, if the promise of increased revenue reserves was in any way going to help us, don't you think the contraction would have slowed by now? The only way additional cash will correct anything is if that cash is put directly into the hands of the people who pay the bills. Of course, we all know that will never happen. Our government will continue to drop wads of our yet unpaid tax dollars into the laps of their corporate sponsors. That, for now, is where the buck now stops.

The New York Times reports that some in Washington are using the latest economic catastrophe to push Congress to make tax breaks permanent. What these folks don't recognize is that the tax cuts are a big reason why the economy is in such bad shape to begin with. With unemployment spiking to 5.5%, the worst since 1986, and oil prices up a record $11 yesterday to $138 a barrel, it won't be long before you're paying $5 a gallon for gasoline.

And since oil is traded in dollars, its 70% decline since January 2001 from 92 cents to the Euro to its current $1.56 -- has been accompanied by a 475% rise in the price of oil. The $1.3 trillion worth of tax cuts -- 36% of which went to the top 1% -- are contributing to record deficits. In 2008, we'll have a $410 billion deficit and the 2009 figure looks to top $500 billion. And thanks to $3 trillion worth of wars, the U.S. is borrowing $9.4 trillion -- almost double where we were in 2000.

Thanks to these deficits, the U.S. is borrowing 66% of its $14.2 trillion GDP -- and any country borrowing more than 60% is seen by international investors as a credit risk. You'll hear people trying to convince you that deficits don't matter. But deficits are at the core of all the economic problems we face. Republicans used to be seen as the party of fiscal conservatism. But what they've actually done would terrify a prudent banker.

Prosper.com is one of the most amazing things I have ever seen and a grand statement of the pioneering spirit that keeps the wheels of prosperity in motion. At Prosper.com individual private investors are able to assist in serving the needs of potential borrowers via a bidding process to finance a wide variety of loan requests.

It works like this: First you register for the service, which the site says is fast, easy and free. Then, you create a loan listing that states how much you want to borrow and the interest rate you are willing to pay. Potential lenders can begin bidding on your loan request as soon as your listing is created. As lenders compete to finance your loan, the interest rate can become more favorable to you. After your listing closes, if you have successful bids, apparently the funds are then deposited in your account. I believe Prosper.com acts as the intermediary for these deposits. Finally, fixed monthly payments are then automatically withdrawn from your account. Prosper.com claims that there are no hidden fees and that the loan can be paid off early without penalty.

I can't actually endorse this service because I have no personal experience with it but it sounds extremely interesting, and the site appears to be for real. I'd love to get some feedback from people who have successfully used this service. If it's as valid as it appears to be, we just might have a new era of personal financing coming over the horizon.

Consumers are still willing to run their lives based on credit, so says an Associated Press report. Consumer borrowing increased at an annual rate of 7.4% in November compared to an increase of just 1% in October - ah yes, the faux magic of a consumerist Christmas.

The truth of the matter rests in the cause for the rise. Is it because consumers are still confident in their earning potential? The more likely cause is that consumers are running out of funding options, read that -- they're running out of cash.

So why is it that mortgages are getting harder to write but consumer purchases can still be funded with just a signature? Although they're deflating in value, homes still provide significant backing for lenders to lean their bets on whereas credit cards float in the unknown. With bankruptcies at an all time high, are we setting up for the final crash?

People have been wondering when, and if, the Federal Reserve would take stronger action to protect borrowers hit hard by the housing and credit crisis. The Associated Press expects new rules to be released Tuesday that would apply to all types of lenders, including banks and brokers. You may wonder what gives the Fed the right to issue these new regulations. While the Fed primarily focuses on the health of financial institutions, it also plays a lead role in two key consumer protections -- the Credit Protection Act (which includes Truth in Lending Disclosures) and the Consumer Leasing Act. In recent years it's been a wild, wild west out there as money flowed freely and a lot of loans were made that helped brokers make money more than they helped consumers find good financing options.

Rules expected to be proposed Tuesday include:

• Barring lenders from penalizing subprime borrowers who pay off loans early. Often there is a $12,000 or more penalty for early repayment on subprime loans. I know people who could qualify for prime loans with lower rates but who are stuck with subprime loans because of a particular loan program that sounded good initially but is now beyond what they can afford. Yes they made a mistake, but paying $12,000 in penalties seems steep to me if someone wants to refinance to get out of a loan their broker steered them to.

I often try to put clever titles on my "Chasing Value" column here at BloggingStocks. But today I have to hand it to my fellow BloggingStocks contributor Jim Cramer, who came up with a doozy this morning. His post is titled, "Fed has grounds to cut to zero." In it, he suggests that the economy is in such poor shape that the Federal Reserve could actually cut rates back to ZERO -- yes 0%.

Is Cramer's close association to Wall Street fogging his thinking? If interest rates get anywhere near 0%, you can sign me up now for all the money in all the banks. I guess than we won't need the Fed anymore since I will have all the money. Everyone can sit by their favorite form of media, waiting to hear what I think about where the economy is going. Of course that won't matter either because if I have all the money the economy will go where I say it will go -- or maybe not?

Then again if the interest rates go to zero, perhaps the value of the dollar will go to zero as well. Cramer needs to look beyond the needs of Wall Street.

To find potential opportunities and verify my track record, read Chasing Value or Serious Money.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm.

There's much speculation today about the possibility of yet another interest rate reduction by the Federal Reserve. Some people indicate they think another rate cut would be a good thing. Pardon me while I ask: Are they nuts?

The dollar is already devalued to the point that our trading partners are getting edgy about their export values, and you can forget about foreign investors sticking their money into American companies to help spur development. Low level municipal bond issues could soon become a thing of the past, and that concept of placing money into conventional savings accounts? Yeah okay, I'll get right on that.

Jim Cramer sings a gloom and doom song about 7 million home owners becoming renters, and declares that the nation will be required to swallow $500 billion in losses. He alludes to a wholesale crumbling of major banks. I see no mention in his blog about possible alternate solutions to the trouble that sloppy bankers have caused themselves. Personally, I don't think that ruining the dollar with yet another round of artificially created economic stimulation based on cheap credit is a good long-term solution for our country, although it might allow some of those sloppy bankers another breather before they have to face the music. The thinking that cheap bank credit will help the economy by infusing borrowed money into the stock market and loosening up spending habits is nothing short of a sucker's bet.

Investors will be focused on the cost of borrowing short-term money as the week begins. Liquidity fears jumped last week when LIBOR rates began to spike in Europe, a sign that money was hard to find. Also, in certain trading days, the euro was quite weak, signaling that investors were moving out of euro's and into other currencies.

Supposedly, some European money-market funds might contain more toxic paper -- subprime and other leveraged loan instruments -- than international investors would have liked, leading investors to start moving assets out of these short-term instruments and back into their local currencies.

As a reminder, as the week begins and concerns about global liquidity persists, U.S. corporations, excluding those that have not been absorbed by private equity, are cash rich and not very leveraged. Most publicly traded companies are prodigious generators of free cash flow.

Further, despite the subprime mess and constant screams that Americans do not save, households have over $5 trillion of cash and equivalent assets. Therefore, both Corporate America and U.S. households are flush with cash.

Look for a drop in LIBOR and U.S. short-term lending rates this week as U.S. and European bankers' efforts to add liquidity to the market take hold. This will be the first step in a series of steps to add liquidity to the U.S. and European economies for the remainder of 2007, which will prove bullish for stocks.

Since its high-profile IPO, it's been brutal for shareholders of Blackstone (NYSE: BX). The stock is down about 7.84% to $23.51 in today's trading.

Other companies -- like Goldman Sachs (NYSE: GS) and Merrill Lynch -- are also feeling the pain.

Basically, the global financial powerhouses have been minting money from private equity. And the result has been escalating stock prices.

Interestingly enough, the chief investment strategist at Merrill, Richard Bernstein, thinks that traders may be getting more lukewarm on buyout speculation.

One big issue is credit availability. Lenders are not only getting tougher on terms -- as seen with the failure on the Chrysler deal -- but there may also be just too much borrowing. Even the global credit market has its limits.

What's more, hedge funds have made lots of money on buyouts. So, if things begin to unwind, there may be even more pressure there. In other words, we might see the losses continue for a while.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

While there are plenty of fast-talking late-night gurus out there who want to give you the information you need to get rich (all for the three easy payments of $29.95, but wait there's more...), the New York Times's Damon Darlin has some of the best personal finance advice that graduates don't want to hear:

• Save 10% of your income right off the top.
• Buy stuff used.
• Enroll in a 401(k).
• Don't borrow money to buy depreciating assets.
• Make your own coffee.

He offers two compelling reasons to start saving early. First, there's the most obvious one. Starting the cycle of compound interest early means your money will grow more. But then there's another one that I hadn't really thought about. Living below your means conditions you to be comfortable with a less expensive standard of living, which will also save you money in your retirement years.

There's another important thing to remember, and it's probably the best reason of all for being wise in your money management. I first realized this paradox when I was talking to my friend "Jim," who, after years of poor spending habits, has run up a huge amount of credit card debt, and lies awake at night worrying about money. He used to make fun of me for my Scrooge-like spending habits and obsession with saving as much money as possible. The other day, we sat down to discuss his problem.

In what could be good news for volatility-wary emerging markets investors, emerging nations are borrowing in their own currencies rather than in U.S. dollars. According to New York Times columnist Davis Wessel, "One thing that has changed is that emerging-market governments and corporations increasingly are borrowing in their own currencies, and that should make their economies more stable."

Part of the reason is that people in emerging markets save money when they can, a novel concept. This is good news for them and it may also be good news for American investors. While many people would love to invest more in emerging markets, the historical volatility may be scaring them off. If that's a thing of the past, at least to some degree, alpha-hungry investors might be more willing to, in the words of Jim Cramer (and Ludacris) go pimpin' all over the world in search of returns.

For broad exposure to emerging markets, I would recommend the iShares Emerging Markets Index Fund (NYSE: EEM), which is an ETF.

(This is a picture of TV detective Columbo working on his famously noisy and unreliable car)

Of course, that title was a trick. There is no good way to borrow money to buy a car. With everything except the purchase of a home, here's a good adage to live by: If you can't pay for it in cash, that means you can't afford it! Do you see how that works? You can't afford to get a car loan to buy a car because if you could, you could just pay for it in cash.

The Boston Globe makes an excellent point about the dangers of car payments, but is a little bit less militant than I am: "First, use a 48-month car loan as a benchmark for affordability. If you can't handle the monthly payments with a four-year loan, you probably can't afford the vehicle you'd like to buy."

But we both agree on one thing: "There is a substantial difference between assets that have the potential to appreciate or that truly hold their value vs. those that depreciate year after year. Your goal should be to put more of your money in appreciating assets."

So if you can't afford to pay in cold hard cash, but the absolute cheapest car you can find, while of course factoring in reliability (Repairs can add up quickly.). And even if you do have cash, can't you still buy a cheaper car and save the money for your retirement? As Suze Orman has said, there is nothing dumber than "spending money you don't even have to impress people you don't even know who pull up next to you at red lights."