It is a national holiday in France, today. But your Daily Reckoning team is on the job anyway. We neither sleep nor rest nor take time to honor any of the world’s bogus holidays. We just reckon.

Bogus holidays?

Well, the storming of the Bastille was hardly cause for celebration. But we’ll come back to that. First, today’s top financial story:

The Dow rose 146 points yesterday; gold rose $14.

Just like the markets. Keep us guessing. Is this a major rally? Or just a feint to the upside? We don’t know. Stocks have been up six days in a row. The shorts have been squeezed…forcing them to buy into a rising market to cover their positions.

And here’s something interesting: “Surprise jump in US trade deficit as imports flood in from China.”

Is this beginning to seem like the sequel: The Bubble is Back II? Not really. The post-bubble trends are firmly in place. The private sector is de-leveraging. Credit is declining and so is private debt. Only the public sector is still adding debt.

Private sector debt is much greater than public sector debt. So when people begin to pay it down, it has a big effect on everything. Jobs disappear. Prices fall. Businesses go broke.

That’s what’s supposed to happen in a correction. That is what is happening now. We see no sign that it is letting up…

Nor is there any sign that the other fundamental trend has peaked out. Wealth and power have packed their bags. They’re moving to the East. Asian economies, broadly speaking, are growing 2 to 3 times faster than the US and Europe.

We have some doubt that the US economy is growing at all. The figures show modest GDP growth. But the figures don’t make a distinction between real growth and hollow, government-goosed activity (such as census taking). One thing is clear, more and more of the economy is being directed, owned and controlled by government. And when the feds are active in an economy, the economy itself loses its vitality. They usually spend money recklessly and invest it foolishly. And why shouldn’t they? Neither their money nor their jobs are on the line.

What’s more, the figures are constantly being revised and updated as new data comes in. A few years from now it may be clear that the US economy has spent the last 6 to 8 quarters in recession.

But back in Asia, there is no doubt there is a boom going on. Growth averages about 7% throughout the region. Incomes are rising. And with so many people in the region, it is already the biggest consumer of a whole variety of products.

Food, for example. While most of the US suffers from a downturn, the farming sector is doing well. Why? Because it has something to sell that Asia wants to buy.

The raw materials producers are also doing well – Canada, Australia and Brazil.

Which brings us to another way China is asserting its new power. It has determined that Moody’s, Fitch and S&P are biased towards the West. Its own rating agency has just announced a new way of looking at the creditworthiness of the world’s governments. In it, the US has been taken down a notch. So have Britain, France and most other western nations. The Telegraph reports:

Dagong Global Credit Rating Co used its first foray into sovereign debt to paint a revolutionary picture of creditworthiness around the world, giving much greater weight to “wealth creating capacity” and foreign reserves than Fitch, Standard & Poor’s, or Moody’s.

The US falls to AA, while Britain and France slither down to AA-. Belgium, Spain, Italy are ranked at A- along with Malaysia.

Meanwhile, China rises to AA+ with Germany, the Netherlands and Canada, reflecting its €2.4 trillion (£2 trillion) reserves and a blistering growth rate of 8pc to 10pc a year.

Dominique Strauss-Kahn, chief of the International Monetary Fund, agreed on Monday that the rising East is a transforming global force. “Asia’s time has come,” he said.”

Yes, Asia’s time has come. But does that mean that the West’s time has gone?

Bill Bonner is the President of Agora Publishing. For more on Bill Bonner, visit The Daily Reckoning.