We mentioned yesterday how any hint of disappointment from China could have a nasty impact on the markets this year. As if to prove the point, markets took a slide as China decided to tighten up its monetary policy. Meanwhile, the dollar rose and gold fell as an executive at one of China’s sovereign wealth funds suggested that the dollar had bottomed and that gold looks a bit dear.

There must be some dark corner of Hell warming up for modern, mainstream economists. They helped bring on the worst bubble ever... with their theories of efficient markets and modern portfolio management. They failed to see it for what it was. Then, when trouble came, they made it worse.