The yen advanced more than 2 percent against the greenback this week as the dollar came under pressure on concerns over the looming debt limit deadline.

The British pound found strong support in the latter half of the week, after declining immensely on Monday, and nearly dropping another 200-pips on Tuesday, on a worse-than-expected price data print which indicated that inflationary pressures were easing.

The Canadian dollar continued to retrace the decline from back in May, and the appreciation in the loonie may accelerate in the following week should the Bank of Canada show an increased willingness to raise the benchmark interest rate.

The European democratic social welfare model is putting in a giant, multi-decade top. Birthrates are low. GDP growth is low. Job creation is low. Debt is high.

The more the takers take the less the makers want to make.

Even though ECB President Trichet was quite clear last week in signaling that rate hikes are not over, based upon interest rate futures, investors are actually pricing in no rate hikes.

In Europe, governments are broke. They have borrowed too much. They can only service their debts if interest rates remain low, or if they get bailouts.

In Europe, no sooner was one can kicked down the road than another one showed up. Greece disappeared from the headlines. Italy took its place.

Economists can't really predict levels of employment, growth, prices, or anything else. And they are especially bad at it when they have the wrong idea of how things work.

Contagion fears have rattled the markets today with everyone worried about the crisis spreading to Italy.