NOWHEREMAN

Emerging Markets: The Haves and Have Nots

You apparently wrote this before the Commodity driven Russian Incursion into Georgia.

While Surpluses may be a Pre-Conflict American Simulation, the Reality suggests an across the board increase by all merging economies to get what they can while they can, especially those without large Military Arms or Nuclear Devices.

The establishment of an Economic Zone within Asia equivalent to the EuroZone will take place within the next 12 months. Russia will probably be excluded. This Asean Zone will be have a greater impact on the developed countries than the EU ever had. The Manufacturing Might of the Developed World will be within their boundaries, how they use this is moot.

IMHO, the inflationary concerns you voice are VERY Real but their choices will be No Growth or Fast Growth, the Effects of previously IMF imposed economics are still remembered. The Current Governments are shakey at best. Japan is proposing a Stimulus Package much larger than anticipated, The Chinese have taken Inflationary Concerns out of their Vocabulary and New Zealand/Australia are about to decrease interest rates. The Stronger WAR Premium
inspired Dollar will increase Inflationary expectations within the EU.

Given the current Real conditions, Commodities will only pause before the final big push to the upside. The evolvement of a larger conflict will exacerbate this move.