July was the 10 year anniversary of the Asian Contagion. Now it looks like the biggest challenge facing global markets has been incubated in the United States. Oddo in France - Macquarie, Basis and Absolute in Australia have been confirmed. There are rumors about BNP and AXA as well as CommerzBank having issues in Europe. Darryl Schoon wrote a great piece on this subject 3 months ago and you really should take the time to read it now.

The biggest takeaway from his discussion is that the US is the world’s biggest debtor nation. We are dependent upon foreign capital to fund our insatiable appetite for consumer spending. By selling our crappy debt to foreign investors, we have shot ourselves in the foot and the ass. I won’t go into the macroeconomic consequences of this for the dollar, interest rates, international trade, consumer spending, etc. But for all the times you have heard that our deficits do not matter, just hear this one time - they do.  When foreign capital funds the deficits, they are tolerable and without them, it will be painful.  America has incubated a contagion, we have spread it through intimate contact with the rest of the world and now that the symptoms are showing up, there are significant consequences.