What a joke the Fed is. They have gone completely against Keynesian economics by easing throughout the cycle and are now on the edge of a Great Depression mistake of tightening going into the downturn of a new cycle. I can't even call them bad economists because they show utter contempt for the whole field. Sadly some still call them Keynesian when they obviously are not.

Congrats to them for taking on controlling their expense line without having to experience a downturn like so many other companies. Their value increase is justified.

China just like all socialistic states trying to implement capitalism, must enable individuals to pursue what they are interested in, and encourage creativity and risk taking. Unfortunately, the recent sharp rise in stock prices hurt not helped reinforce risk taking. It is also unfortunate that the US continues on policies that undermines its already strong small business culture in favor of TBTF banks, big healthcare, and monopolized state housing financing through Fannie and Freddie Mac.

In most cases, the state is a crutch and is a hindrance to progress much more than a benefit. Hopefully, China is able to succeed to grow small medium sized businesses free from government influence. It will help them on the path to a more stable economy, lead them to the next phase of development (value added goods over straight manufacturing), and help it move into a democracy (which it still resists). Its ability to do these will define whether it sets itself up for more growth or sinks under the weight of a socialist government dealing with post industrial growth shrinkage.

The monetary system we have implemented now guarantees it is always impossible to pay off debt without devaluation and more debt. The losers will be the ones who fall first and get saddled as bad debtors which they chose to be out of stupidity. The US is sadly going that direction because of a malevolent central bank that encourages ever increasing debt loads and a government that can't say no.

States are going to have a terrible time in the next downturn. Like all governments, they spend all they have and spend more even in upturns. Even if interest rates rise States may have a tough time with their debt.

Thanks for the article. This issue can get gradually wider affecting many countries.

Puerto Rico hasn't really been factored into the decline. After it there's Argentina. After that SE Asia and India. We will see how far down the rabbit hole we go.

There is a reason the car was never invented in France. If the world was France we'd still be in the dark ages.

We will see after we find out what happens to the Euro next week. China is not looking too healthy right now either as it creates unnecessary problems in SE Asia in its quest to prevent its manufacturing from escaping to new low income tiger countries. Safe havens are likely to be the theme this year, especially after it becomes clear the US is not on the road to a strong recovery. How can it be, its stuck in the QE trap.

Please stop blaming the Germans for seeing reality. Greece as it is run now is not viable nor has been for the last 10 years. Likewise, bad debt is bad and Greece's is worthless. they never have an intention of ever paying it back and believe bugger thy neighbor is legitimate. It isn't and its about time they learned it.

After what happen to Greece when it leaves, no others will want to follow. Hopefully it will make other bad economies in the EU wake up and cut back their ridiculous budget deficits.