For some time now, as the financial storm clouds approached, various analysts have touted the view that the emerging markets and the rising powers – China, India, Brazil and Russia, and others – are increasing decoupled from the United States and the sub-prime threat. Now that the financial meltdown is upon us, I suspect those who argued such a line would be happy to take it back (Note Dani Rodrik’s disdain for decoupling as well in his blog post ‘The Other Shoe Drops‘.)

Now it is not to say that these Rising Powers are bound to find themselves in the situations they faced in say 1997 or 1998, but they are all being buffeted in different ways by the gales of this widening financial meltdown.  Contagion is upon us Continue reading →