A decade ago, many states and metropolitan areas saw bio as their tickets to the future. The gambit didn’t work out for most of them (for my assessment of Phoenix’s effort, you can read here and here). Seattle was fortunate to have an established cluster, which was ranked No.  5 nationally in an influential 2004 report by the Milken Institute. How are we doing now? Hanging on, barely. A new report by Jones Lang LaSalle has Seattle as the nation’s tenth largest “established” bio cluster. The leaders: Boston, San Diego, the Bay Area, Raleigh-Durham, Philadelphia, D.C, New York, Los Angeles and — a newcomer to the list — Minneapolis. Among the “emerging” clusters are Westchester/New Haven, Conn., Chicago, Denver, Cleveland-Columbis-Cincinnati and Salt Lake City.

The report states:

Seattle has one of the fastest growing life sciences markets in the nation and has become one of the core cancer research markets in the nation. Puget Sound’s life sciences is comprised of nearly 1,000 firms employing more than 22,000 directly in the industry, with an additional 191,000 people employed in the hospitals and the medical field. One of the distinguishing features of the Seattle-area life sciences market is that very little manufacturing is done in the region. Nearly all Puget Sound-area life sciences industry activities are based on research and development. Unlike areas with a strong concentration of life sciences manufacturing jobs, when a growing Puget Sound company is purchased by a larger company, the frequent trend has been the employees and the companies to remain intact and local to Seattle. This is the case with many companies like Zymogenetics, which was acquired by Bristol-Myers Squibb in 2010; Blue Heron, which was acquired by OriGene Technologies in 2010; and Sonosite, which is being acquired by Fujifilm.

So Paul Volcker is out and Jeffrey Immelt is in. The former Federal Reserve chairman who broke the back of inflation in the early 1980s never received much of a hearing from the Obama White House. His role as head of the Economic Recovery Board was largely symbolic; most of his recommendations on holding the financial sector accountable for its recklessness and checking future behavior went into the president’s circular file. And no wonder: The real policy power rested with Larry Summers, protege of investment banker Robert Rubin and one of the fathers of financial deregulation.

With Immelt, chief executive of General Electric (hand picked by Jack Welch), Obama is said to be projecting his new “pro business” image. Even the U.S. Chamber, which campaigned ardently and with big bucks against the administration’s policies, is about as happy as it can be with the Immelt pick.I suspect Immelt won’t be a figurehead, but how much time he has to devote to mere American matters is an open question. GE employs more workers overseas than it does in the United States, and the U.S. accounts for a shrinking amount of GE’s focus. It just entered into a risky technology sharing agreement with a state-owned Chinese company to build aircraft engines for Boeing’s future competitors.

Like most major CEOs, Immelt is a citizen of the world, presiding over an enterprise with larger earnings than the GDPs of most nations, answerable to his shareholders and the brilliance inside his own head.. Can America’s interests really coincide with those of GE, or any transnational corporation? We’re just one more market to them. The world, and executive values, have changed vastly since General Motors President Charlie Wilson said, in 1953, “For years I thought what was good for our country was good for General Motors, and vice versa.”

If you missed it, check out this article (with map) by the Seattle Times’ Eric Pryne on the transformation of South Lake Union. For all the controversy among locals, the combination of Paul Allen’s Vulcan Real Estate, Amazon.com and the biotech sector show off some of the key strengths of the Seattle economy.

A wealthy steward who could invest anywhere — and get plenty of incentives from cities and suburbs anywhere — but chooses to do so in the heart of his hometown. A major corporate headquarters that could locate out on a freeway but chooses the dense, creative landscape of the city. The diverse bio cluster that also thrives in the city. Other companies including Group Health add to the high-wage jobs there. It’s a powerful combination, and one that most cities don’t have.

I remember getting a call from a journalist in Phoenix because Allen had bought a defunct building in a suburb; would Allen “do there what he had done in Seattle?” I doubted it because the Phoenix area lacks the economic assets to fill a South Lake Union-like development. It has an Amazon warehouse, to be sure. But it lacks the talent, the companies and the education level to operate at Seattle’s level, even though it is a larger city and metro.

While Goldman executives blabber before Congress and Alan Mulally’s Ford seems to be doing well, the markets are roiled by the downgrading of Greek government debt to junk status. And they should be. Commentators keep worrying about the “contagion” of the so-called sovereign debt crisis, not only in Greece but also Portugal, Ireland and even Spain.

But the deeper problem will sound familiar: Overexposure of European banks and the complex, opaque instruments into which the debt has been sliced, diced and sold over and over. In other words, systemic risk that may well not be confined to the PIGS, but could spread to Germany, France, Britain (Goldman’s involved, too, but no doubt will profit). Too-big-to-fail banks playing risky games, dangerously interconnected.

This is the housing crisis deja vu. Repeated reassurances the worst is over, the crisis is “contained,” then another shoe falls out of the closet. Is America’s financial system safe from the fallout? It’s a bad time, amid a fragile rebound, for another surprise.

It’s instructive to compare this with the Asian financial crisis of 1997. Thailand, South Korea and other tiger economies had amassed large foreign debt and there was fear of worldwide contagion. That the crisis was contained and didn’t bring down the United States has been ascribed to the International Monetary Fund and the skills of then Fed Chairman Alan (“70 Percent Right”) Greenspan and then Treasury Secretary Robert (“Even I Don’t Understand These Derivative Thingies”) Rubin. But another critical difference: American banks were very different then: smaller, protected by Glass-Steagall, relatively well regulated, with a much smaller derivative market and shadow banking syndicate.