Worldwide recession looming...

• From the AP, major corporations from all over the world are girding their loins for a legitimate recession. The culprit this time isn't the credit crunch - at least not directly - but poor earnings reports from the very top of the corporate food chain. The result? Merck is cutting 8000 jobs. Yahoo! 1500. And so on and so forth. The Dow, of course, is feeling the blow already, as it's down nearly 300 points.
  
• "That's not exactly worldwide, Matt," you're saying. Well, look at what's happening in China according to McPaper.
  

  Tao built River Dragon from a start-up with four employees into one of China's biggest textile printing firms in just five years. He had even grander dreams: He wanted to see his company's stock trade on Nasdaq alongside the likes of Microsoft and Intel.

  The dreams are dead. River Dragon shut down on Oct. 7. Tao and Yan have vanished, leaving behind more than $290 million in debt and a lot of anger in this city 140 miles south of Shanghai in the Yangtze River Delta. The company's demise put 4,000 workers on the street and jilted hundreds of suppliers and creditors.

• It's happening in Latin America, too.
• The FT points out that, while we've weathered the initial storm, the clean-up is going to be a long, long process. And that we've reaped what we sowed:
  

  Consider the burdens weighing down on these countries. Between 1980 and 2007, the ratio of US gross financial debt to gross domestic product – a measure of the sector’s leverage – jumped from 21 per cent to 116 per cent. Today, as a result, the arteries are clogged with bad debt.

• LOL@Friedmanites. Your Southern Cone Counter-revolution of the 1970s (finally) breathes its' last.
• The Making (and Remaking) of John McCain is this week's most illuminating read from the campaign trail. Robert Draper does a good job of shedding light on how and why McCain has lurched drunkenly from policy position A to policy position B without any seeming regard for message coherence. The result? A candidate and campaign that's lacks an overarching message beyond "Elect me!" and a candidate that looks woefully out of his depth.
• How bad has it gotten for McCain? Rahm Emanuel asks for an apology from the GOP for all their negative campaigning...
• ... and Sarah Palin delivers. Think the transformation from "Pit-bull" to "Repentant 3rd Grader" was part of Team McCain's long-term strategy?
• And finally, Al-Qaeda is trying its hand at American electoral politics, just as they did in 2004. From the AP courtesy of Breitbart:

  Al-Qaida supporters suggested in a Web site message this week they would welcome a pre-election terror attack on the U.S. as a way to usher in a McCain presidency.

  The message, posted Monday on the password-protected al-Hesbah Web site, said if al-Qaida wants to exhaust the United States militarily and economically, "impetuous" Republican presidential candidate Sen. John McCain is the better choice because he is more likely to continue the wars in Iraq and Afghanistan.

  "This requires presence of an impetuous American leader such as McCain, who pledged to continue the war till the last American soldier," the message said. "Then, al-Qaida will have to support McCain in the coming elections so that he continues the failing march of his predecessor, Bush."

  SITE Intelligence Group, based in Bethesda, Md., monitors the Web site and translated the message.

• Happy hump-day, everyone.