Peter Eliades asks inflation or deflation??

• See CRBQ which is the Thomson-Reuters Jefferies Global Commodity Equity Index Fund

-------- Original Message --------

Subject:	Re: CRB Weekly with parallel channel
Date:	Wed, 9 Mar 2011 15:54:05 -0800
From:	Jas Jain

From: Peter Eliades
To: jas_jain
Subject: Emailing: CRB Weekly with parallel channel
Date: Wed, 9 Mar 2011 15:00:27 -0800

What say you, O great Guru of India, inflation or deflation??

Hello Peter,

I don't track the CRB. The resilience of the US Treasury bond market is pointing to the deflationary resolution. No, not tomorrow, but whenever the current trends in the Scam Market and the commodities reverse. This is a long-term prognostication. The past two years are not a reflection of any long-term trend reversal.

The 3-Year inflation rate in the US, both core as well as the headline, is at a 45 years low. The headline inflation rate over the past 2.5 years (Jul'08-Jan'11) is at an annual rate of 0.05% (no typo here, it is 1/20^th of a percent); I would admit that it is a result of the gasoline prices peaking 2.5 years ago and now they are back on the rise.

Bernanke would fail in his fight against deflation. No, we are not Japan, but our neo-Keynesian economists advised the Japanese about the QE some 15 years ago! Americans' buying power (aggregate demand necessary to drive inflation up in the US on  a sustained basis) is not a force to fear.

Best regards,

Jas

CRBQ

h

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