Is the rescue in Europe going to work

The success of European 1 trillion dollar rescue depends on two things: The first is whether Germany is willing to subsidize its southern neighbours. The government may not have other options but the voters may revolt. The second question is whether PIIGS countries willing to accept the deficit cutting measures. They are going to be painful.

The UK new coalition government is not stable. Cameron can not compromise too much.

Chinese economy will slow down (but not crash down). The property market has shown signs of cracking. The stock market in China has corrected more than 20% which is a good indicator.