Ambrose Evans-Pritchard brings his usual incisive insight to the state of the world economy.
Sitting on the desks of central bank governors and regulators across the world is a scholarly report that spells out the vertiginous scale of global debt in US dollars, and gently hints at the horrors in store as the US Federal Reserve turns off the liquidity spigot.
This dry paper is the talk of the hedge fund village in Mayfair, and the stuff of nightmares for those in Singapore or Hong Kong already caught on the wrong side of the biggest currency margin call in financial history. "Everybody is reading it," said one ex-veteran from the New York Fed.
The report - "Global dollar credit: links to US monetary policy and leverage" - was first published by the Bank for International Settlements in January, but its biting relevance is growing by the day.
It shows how the Fed's zero rates and quantitative easing flooded the emerging world with dollar liquidity in the boom years, overwhelming all defences.
This abundance enticed Asian and Latin American companies to borrow like never before in dollars - at real rates near 1pc - storing up a reckoning for the day when the US monetary cycle should turn, as it is now doing with a vengeance.
Contrary to popular belief, the world is today more dollarized than ever before. Foreigners have borrowed $9 trillion in US currency outside American jurisdiction, and therefore without the protection of a lender-of-last-resort able to issue unlimited dollars in extremis. This is up from $2 trillion in 2000.
The emerging market share - mostly Asian - has doubled to $4.5 trillion since the Lehman crisis, including camouflaged lending through banks registered in London, Zurich or the Cayman Islands.
The result is that the world credit system is acutely sensitive to any shift by the Fed.
. . .
Powerful undercurrents in the world's financial system are swirling beneath the surface. Some hope that the European Central Bank's €60bn blast of QE each month will keep the asset boom going as the Fed pulls back, but this is a double-edged effect for the world as a whole. It pushes the dollar yet higher. That may matter more in the end.
. . .
Nobody should count on a Fed reprieve this time. The world must take its punishment.
There's more at the link.
This is what debt on an international scale can do. In microcosm, each of us faces the same problem as the debt of others - our neighbors, our companies, our local, state and national governments - impinges on our own economic circumstances and future.
It's not looking healthy right now.