Inflation Rising Despite Weak Global Economy

The U.S. gross domestic product deflator rose to 2.2% in 2011 from 1.2% in 2010, and China’s rose to 8.3% from 7.4%. Monetary expansion around the world will work into prices. It may inflate some asset prices along the way, but will eventually become inflation through the path of least resistance, i.e. inflating prices of goods with low supply flexibility. . .