Relief is washing around the world, but not indiscriminately. While developed countries are writing ever bigger cheques to bail out their banking systems, emerging economies are struggling to pay off more modest external debts. Take Pakistan. It has been on the brink of default twice before - in 1993 and 1999 - and the risk looms once again. Credit default swap spreads yesterday blew out to 3,084 basis points, according to Markit, up from 520 basis points in January. This is just the latest setback for Asif Ali Zardari, who took up the presidential reins after Pervez Musharraf stepped down in August.

The Karachi 100 Index has shed 46 per cent year to date in dollar terms, even though it barely traded in the weeks that global markets were trashed. The currency, reflecting jitters about the country's external financial position, has slumped 22 per cent against the dollar this year.