Alwaleed gives eight reasons to refute $200B transfer of Saudi assets from US

Saudi Prince and entrepreneur Alwaleed Bin Talal told a number of print and broadcast journalists why he strongly believes the rumours that Saudis have withdrawn $200 billion from their assets in the United States are false.

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By  Massoud Derhally Published  September 9, 2002

Saudi Prince and entrepreneur Alwaleed Bin Talal told a number of print and broadcast journalists why he strongly believes the rumours that Saudis have withdrawn $200 billion from their assets in the United States are false.

In interviews with CNN, Al-Jazeera television, the Lebanese Broadcasting Corporation (LBC), the BBC, Reuters, Bloomberg, Asharq AlAwsat (the largest international Arabic paper), and the Financial Times (FT), which started the $200 billion withdrawal rumour, the Prince cited eight reasons why he believed the withdrawals could not have taken place. [See http://www.itp.net/news/103051622172218.htm ]

Alwaleed’s first reason is that withdrawing $200 billion within a period of two months could not have taken place without a major financial disruption in the United States regardless of whether the transfers were of liquidated stocks, bonds, or even time deposits.

The second reason is that the markets in the US during the months of June and July were at an extremely low level prompting one to wonder why Saudi investors would liquidate at a great loss.

Third, the Prince says that experts know very well that the real estate market in the US has been a buyers’ and not a seller’s one. Once again one is prompted to ask: “does is make economic sense that Saudi investors would liquidate at this inopportune time? And is it possible to sell that much real estate, transfer ownership, collect the value in cash and transfer the money in a matter of only two months?”

Fourth the statement from the Prince’s office at Kingdom Holdings says, if one were to hypothetically accept that the transfers did materialize (although prince Alwaleed confirms the complete opposite), and if one were to assume that the average investment per Saudi individual or corporation in the U.S. amounted to five to ten million dollars, that would mean that 20,000 to 40,000 Saudi entities transferred the alleged, aggregate sum of $200 billion. If that were the case, would not one wonder if a centralized command was orchestrating such an organized, collaborative move? The answer, naturally, is a ‘NO’.

The Prince also says that when the news of the withdrawals broke out, he asked his executive staff to conduct a review of deposits that were published as part of the second quarterly results of US banks and concluded that deposits climbed rather than declined.

Six, the Prince has personal information based on strong relationships with US banks to confirm the invalidity of the withdrawal rumours.

Prince Alwaleed also met with prominent Saudi investors in Cannes this summer and they all dismissed the withdrawal allegations as rumours while confirming their continued commitment to investing in the United States.

The article in FT concludes the statement was allegedly based on ‘a single source’. For such a ‘single sources’ to be acceptable it has to be the calibre of Mr. Allen Greenspan or Mr. Paul O’Neill. Otherwise, many more sources need to be identified for the FT story to be credible.

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