I call it the Rule of Three. If you read a company's financial statements three times, and you still can't figure out how they make their money, that's usually for a reason.

Increasingly, the real estate developers can't get bank loans for their project financing in China. They're now going into the Hong Kong market to raise money in the bond market at very, very high rates, as high as 15, 20 percent.

The interesting thing about the China story, getting back to the macro and micro, and as dire as I think the macro story is - due to bad credit and credit extension that makes Greece and Spain and the U.S. look like child's play - when you get to the micro of individual companies, they look even worse.

Our concerns about what we saw in Australia: an economy clearly tied to China has hitched its wagon to the tail of the tiger. In terms of the general complacency, what we heard over and over from investors and clients and potential clients is, 'yes, yes, there are some excesses, but the government will figure out a way.

Derivatives in and of themselves are not evil. There's nothing evil about how they're traded, how they're accounted for, and how they're financed, like any other financial instrument, if done properly.

The U.S. healthcare system is probably the most interesting large group of companies that are heading for major problems that we've seen in a long, long time.

So you know, everyone points out Greece's default record, but the history of a lot of sovereign nations is not a good one when it comes to lending them money.