One day Rio Tinto, the worlds third largest miner, was talking about an eternal resources boom with ever rising prices, the next day it is slashing 14,000 jobs from its global workforce, selling several of its most attractive assets and closing down its mines. The reality is that Rio Tinto is burdened with debt and there is a big question mark over its capacity to service its $A59 billion debt given the crash in commodity prices.

The future is not promising. China's exports fell for the first time in seven years, (down 2.2 per cent in November), with imports falling 17.9 per cent. China's economy has slowed much more quickly than anyone had forecast. Asian economic growth in general is declining.This suggests that global trade is contracting quite rapidly. And since trade accounts for a rising share of global activity, it suggests that the global economy is contracting.