Here is more bad economic news from Asia. Yet those countries don't have banking crises as many other nations do. So what exactly is up?

The usual story is that these nations are "heavily dependent upon exports." But if I may wear my Don Boudreaux hat for a moment (or more), is not the state of Kentucky also heavily dependent upon exports? Is not the Cowen household heavily dependent upon exports? Why is being dependent on exports so especially bad for parts of Asia?

One answer is that Asian exports, which travel great distances, are often consumer durables and such purchases are especially easy to postpone. Services are often more robust.

Another answer is that many Asian producers have chosen high fixed costs in a way that requires steady or rising revenue over time. That is their version of being highly leveraged without taking on much explicit debt. Again a central lesson of this depression will be how many different ways there are to leverage.

Last week I was surprised to read this:

“For a long time, Harvard had a negative 5 position,” she said. “That

means that 105 percent of the assets are invested at most times.”

So far it seems that the least leveraged parts of the world — all things considered — are South America and sub-Saharan Africa. Brazil, Chile, and Peru are a few of the countries which, in relative terms, are suffering least. If you wish to understand the course of events, keep your eye on those locales.