The global financial system is highly intertwined, so no corner of the world has been left unscathed by the current financial crisis.

As the financial crisis shakes out, there is a huge shift in power taking place. For many years, the world's financial power used to lie in the hands of debtors (i.e. the U.S.). But since the financial crisis has forced economies around the globe to massively de-leverage, those with highly leveraged financial systems have been hit the hardest.

And even economies that are rich with natural resources, like Brazil, Canada, Australia and Russia, have suffered during these tough economic times. That's because they have high levels of debt, and also spent extravagantly during the commodities boom that has now fizzled out.

As a result, there's been an incredible amount of deleveraging occurring around the globe. And in this new era of rapid financial deleveraging, entities with highly leveraged financial systems — like the U.S. and Europe — are more vulnerable to the financial crisis than those with less leverage — like China and Japan. That's because these countries and regions are flush with capital and have provided safe havens for global capital during the recent financial turmoil.

For example, an investor leveraged 10-to-1 would be wiped out by just a 10% drop in price, but investors without leverage, a 10% price drop is not a big deal. So those with minimally leveraged systems have been more insulated from the crisis.

That means China, the world's largest saver nation, does not need to deleverage its financial system and undergo painful economic adjustments in the Western world. Actually, since China has the world's largest foreign reserve — which is now approaching $2 trillion — China is helping other nations overcome the global financial crisis. And it is likely that China will continue to use its current account surplus to purchase U.S. Treasury securities and indirectly help finance the U.S.'s financial bailout efforts.

So while the U.S. and European nations face the most severe financial crisis since the Great Depression, business continues as usual in Beijing since its financial system is insulated from the ongoing credit crisis. In fact, even as liquidity-starved banks in Europe and the U.S. struggled to stay afloat, Chinese banks reported little increase in their bad debt ratio in the past quarter.

And although China is subject to the same stock and property price declines plaguing the rest of the world, Chinese banks have far less exposure to asset price declines than banks elsewhere.