The Gulf Times leads with a story on Sheikh Abdullah Bin Zayed Al Nahyan, Minister of Foreign Affairs, speaking at the UN General Assembly about nuclear power.

“The UAE’s commitment not to enrich uranium and reprocess fuels locally is among the most salient features of this model. This is a model supported by enhanced international transparency and cooperation mechanisms,” he said.

The National also led with this, adding that the GCC may have a major role to play in “attempting to settle mounting concerns over Iran’s atomic programme.”

Arabian Business has a cracking story (even if we do say so ourselves) about some UAE construction firms charging workers recruitment costs. Bound to be a hot topic.

Khaleej Times reports that swine flu fears are falling as more pupils return to school for the start of term. Most schools recorded a 95 percent attendance rate on Sunday, the paper said, but then you would hope that seeing as they started on Wednesday the previous week.

Meanwhile, 7days has spoken to Rita Dutt, the sister of Ruma Ghose-Puri, who was killed by stalker Rashid Daabaz.

“She was my sister and my best friend. I am begging the people of Dubai to help. We need new laws and new police procedures for dealing with stalker cases. It could happen to anyone and you feel so powerless,” she told the paper.

Have you got a story? Let us know, email elsa_baxter@itp.com

Free, The Future of a Radical Price, by Chris Anderson
Random House Business Books
$14.55 (hardcover) at amazon.com

What happens when advances in technology allow many things to be produced for more or less nothing? And what happens when those things are made available to us for free?

This is the question posed by the latest book on global business trends by Chris Anderson, editor of US new economy magazine Wired, and author of The Long Tail, which considered the impact of unlimited digital shelf space on how goods are bought and sold.

Anderson argues that as computer processing speed doubles every 18 months (Moore’s Law) and internet bandwidth trebles every year (Gilder’s Law), the cost of anything made of bits and bytes will reduce in cost so far over time that you might as well round it down to zero.

He then explores a host of other business models that survive by making it possible to offer one product or service for free, by charging for other related products or services.

A quick trip through history finds the obvious example of Gillette razors, where the reusable razor was virtually given away because customers would buy disposable blades forever.

Or the budget airline model where seats on flights can be sold for free because money is made in other ways: advertisers paying to reach the passengers; credit card handling fee; charging for check in bags, even charging cities who want the airline to land there because it boosts tourism.

The book rambles a little as it compares different business models and illustrates their strengths and weaknesses with examples from the past and present. Most readers will draw inspiration from only a handful of these examples that chime with their thinking or directly relate to their current businesses.

The central idea - that free is a price that touches ever-expanding parts of our personal and business lives - is woven throughout.

Perhaps the most insightful moment in the book comes from research by behavioural economists who compared the reaction of people to buying a chocolate bar at a very low price, to their reaction when given it for free. Even though the chocolate with a low price tag was so cheap it made little difference in people’s wallets, the psychological barrier of parting with any money at all was enormous when compared to the instant uptake of the free offer.

In summary, any business that is able to offer something for free will find a much larger customer base than a business that charges. That hardly qualifies as the greatest innovation in business thinking this century, but finding ways to exploit a price of zero, and make money elsewhere for a business, is a challenge that is increasing day by day.

Transparency looks set to be the only winner in the fallout from the Algosaibi and Saad groups.

Exactly what has happened at the Saudi firms at the centre of a corporate scandal rocking Saudi Arabia is still not clear.

What is clear, however, is that it has changed how family owned companies in the region will be able to do business.

The practice of “name lending” has been widespread in the Gulf, where companies have been able to borrow money based solely on their name recognition and reputation.

But as the dispute between Algosaibi and billionaire Maan Al-Sanea moves into a New York court room and banks brace themselves for losses amid debt restructuring at the two companies, privately held firms are going to have to become more open or face having their financing cut off.

Friday’s move by Algosaibi to pursue its claims against Al-Sanea through the courts marks a departure from the private culture of the region’s family owned companies.

So private are they that many Gulf firms do not even have a public relations department for media professionals or other people seeking information about them. (A well known retailer recently fired its entire media relations team – tellingly, without informing the media about it.)

That privacy has extended to the debt markets, where the same companies have been unwilling to communicate key financial information to banks, credit rating agencies and other financial institutions.

Banks across the region are now feeling the effects of that secrecy, as names that were previously thought unsinkable default on bank loans and bonds.

The UAE central bank has said the country’s lenders have “significant” exposure to the Saudi companies, and has asked all banks operating in the country to inform it of the size of any loans extended to them.

Omani banks are the only ones in the GCC to have publicly announced their exposure to the beleaguered conglomerates.

Other banks would do well to follow their example and provide the market with some of that transparency their borrowers seem to lack.

At the time of writing, shares in Emaar Properties are down 10 percent in the first five hours of trading since it announced it would be acquiring Dubai Holdings companies Sama Dubai, Tatweer and Dubai Properties Group.

Investors are trying to absorb the complexity of the deal and, in the absence of hard facts about the future of the business, they are taking the obvious course of action: clear out of the stock until reliable information emerges.

Sama, Tatweer and DPG are private companies without published accounts. In essence, all three are holding companies - subsidiaries of the daddy of all holding companies: Dubai Holdings.

As such, they are the sum of their assets, rather than assets in their own right. To illustrate the intangible role of these companies, you only have to read their mission statements. For example, on Tatweer’s web site, it has a frequently asked question section that provides the following insight:

Question: What is Tatweer’s main strategy?

Answer: Tatweer will focus on leadership development to achieve business excellence and world class quality standards for all of its subsidiaries.

Tatweer will become a world class enterprise through value generation, customer focus and excellence for our people and stakeholders. In addition, it will focus on developing and diversifying the business portfolio by capitalising on market opportunities in existing and new sectors.

If anybody can find a statement with less meaning than this, please send it on a postcard to Arabian Business.

The assets under management by these holding companies are considerably more meaningful, but no easier to value.

Emaar has said that the combined companies will have assets worth a total of $52.85 billion. Not $52 billion, not $53 billion, exactly $52.85 billion - precision that suggests real mathematics and accounting is involved.

In its current trading statement, Emaar says that its assets are valued at $16.5 billion. The combined total for Sama, Tatweer and Dubai Properties is therefore $36.35 billion.

The value of Sama, Tatweer and Dubai Properties assets are therefore priced at more than double the value of Emaar’s assets.

Judge for yourself whether that calculation seems reasonable, by comparing the value of these assets:

The first thing that strikes me when comparing these lists of projects is that Emaar is considerably more diversified in terms of its geographic spread. Between Sama, Dubai Properties and Tatweer, only three projects are outside the UAE. For Emaar, the majority are non-UAE.

Real estate values are falling all around the world, but nowhere faster than the UAE. Emaar’s asset value should therefore be more robust than those of its new businesses.

The real question for investors is how to value these assets, what are the business plans of each project (cashflow, revenues, profits), and what will be their impact on the overall profitability and growth prospects of the group.

This would require a full time team of forensic accountants and researchers several years to evaluate.

Which makes it all the more surprising that a value of $52.85 billion has been established only moments after the news was released that these companies would be merging. I’m not saying that it isn’t $52.85 billion, but I expect I could make a case for $52 billion or $53 billion just as easily.

You do the maths, and let me know what you conclude.

Buried on page 34 of yesterday’s edition of The Times was news that should have knocked MP’s expenses and even Jordan and Peter Andre’s divorce off the front page of UK newspapers.

The credit crunch has ended.

The London interbank offered rate (LIBOR), the rate at which banks lend to each other, fell to levels last seen in early 2003, and around one quarter the level of 2005 when subprime mortgage defaults rattled the US banking sector and set in chain events that led to the collapse of Lehman Brothers a year later.

The spread between the UK Bank of England base rate and Libor has also narrowed to 2007 levels, still not back to the razor thin spreads seen at the height of the credit splurge of 2005, but low enough to prompt respected economists and bankers to suggest “normal” lending should now resume.

The GCC banking sector is also returning to normal. The three month Emirates interbank offered rate (EIBOR) dropped to 2.4875 today, down from a peak of 4.7875 in October last year. The Saudi Arabian interbank offer rate (SAIBOR) is down to 1.13 percent after averaging 3.37 percent last year.

The technicality of whether the credit crunch is over or not may be of little interest to the average man on the street. But it is more than a mere academic question.

Interbank rates directly affect current and future home owners in the UAE. HSBC offers tracker mortgages of 4 percent above EIBOR, making home loans available today at 6.5 percent 2-3 percent lower than the banks variable rate of 8.5-9.5 percent, depending on the size of a customer’s deposit.

The new company that emerges from the merger of Islamic lenders Amlak and Tamweel is expected to open within weeks with competitive mortgage deals.

Lending is beginning to become cheaper and more affordable at the same time.

It is unlikely that lending to businesses and individuals will return to 2007 levels any time soon. Nor should it. Lending should be made on the conservative calculation of customers’ ability to service loans, and should be secured on assets that are properly valued or on salaries that can be reasonably expected to continue.

2007 lending was based on the price of real estate that was assumed to be permanently increasing, and on salaries that were expected to rise, uninterrupted, forever. The banks will not make the same mistake any time soon.

So while you may be able to wave goodbye to the credit crunch, you have to accept that living within your means in a new age of austerity is not going away any time soon.