There's an ancient Chinese proverb: When a Shanghai taxi driver gives a stock tip, the market has topped.

In 2006, the average Asia-Pacific fund we track roared ahead by 23.5%. But the stock mania came to a screeching halt in Shanghai, China, on Tuesday, trimming 8.8% off the Shanghai Stock Exchange Composite index. This set off a series of stock market fender benders around the globe.

Tuesday's damage also wiped out much of the year-to-date gains for Asian-Pacific funds. (See chart below.)

This may turn out to be a healthy correction to frothy global markets needing to readjust to slower predicted U.S. economic growth rates.

Or, if Mr. "Irrational Exuberance," former Fed Chairman Alan Greenspan, is correct and we are headed for a U.S. recession later this year, Tuesday may be cited as the first day of a new bear market.

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The fund that took the worst hit was the Asia Tigers Fund (GRR) . It has a 24.9% concentration in South Korean stocks with that country's Kospi index losing 1.05% Tuesday and another 2.56% on Wednesday.

The fund's 17.7% allocation of Hong Kong stocks didn't help, either; the Hang Seng index lost 1.76% Tuesday and 2.46% Wednesday.

The best advice ever given was from Douglas Adams in his book Hitchhiker's Guide to the Galaxy, when he wrote, "Don't panic."

Shanghai stabilized on Wednesday. And the U.S. markets have opened in an orderly manner, rather than extending yesterday's plunge.

Kevin Baker became the senior financial analyst for TSC Ratings upon the August 2006 acquisition of Weiss Ratings by TheStreet.com, covering mutual funds. He joined the Weiss Group in 1997 as a banking and brokerage analyst. In 1999, he created the Weiss Group's first ratings to gauge the level of risk in U.S. equities. Baker received a B.S. degree in management from Rensselaer Polytechnic Institute and an M.B.A. with a finance specialization from Nova Southeastern University.