The Global Picture

When the housing crisis and credit crunch first gained momentum, the consensus was that the meltdown was relatively isolated within the U.S. and did not present itself to be a serious contagion.

The rest of the global economies and financial markets would decouple from the mess, especially those in emerging markets with double digits GDP growth and in countries awash in petrodollars.

Now, the rest of the world is taking a hit. Optimistically, this has led to the recent strengthening of the dollar as investors take flight from other currencies. However, it may also contribute to a decrease in exports and a lower demand across the globe for American goods; one of the few bright spots that still remains today.