Broadly speaking, the US and Japan sat out the emerging market credit boom. The lending spree has been a European play – often using dollar balance sheets, adding another ugly twist as global “deleveraging” causes the dollar to rocket. Nowhere has this been more extreme than in the ex-Soviet bloc.

Russia too is in the eye of the storm, despite its energy wealth – or because of it. The cost of insuring Russian sovereign debt through credit default swaps (CDS) surged to 1,200 basis points last week, higher than Iceland’s debt before Götterdammerung struck Reykjavik.

The markets no longer believe that the spending structure of the Russian state is viable as oil threatens to plunge below $60 a barrel. The foreign debt of the oligarchs ($530bn) has surpassed the country’s foreign reserves. Some $47bn has to be repaid over the next two months.

Already we have witnessed tax-and-spend politicians seize upon the credit crisis to propose measures that would take the “private” out of “private property” and would deliver ever more aspects of the economy into the governments’ hands, aiding and abetting their increasingly ambitious efforts to “spread the wealth around.” I shudder to think what embracing such policies would portend for prosperity and freedom.

And the people that thought they could harm the U.S. by financial means were shocked when they found their own markets folding up. You don't take away the biggest player from the card table, before everyone else calls or folds.