China

China will go into a depression. Just look at the news from Bloomberg. Chinese banks aren't lending to factory owners that need the cash. "Half the nation's toy exporters have closed this year, and 67,000 smaller enterprises filed for bankruptcy in the first half, according to government statistics." Loans to small businesses are defaulting at four times the rate of larger companies. Small businesses, however, are the backbone of the Chinese machine, providing "three-quarters of urban jobs and 60 percent of China's gross domestic product."

The problem with the Chinese economy is that it's all built on more and more debt. Loan growth has slowed to 6.2%. I remember reading a year or so ago that credit growth was running in the low 20's. That fueled GDP growth of 11%. Now that credit growth is 6%, GDP will probably drop to 3%.