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ETF Ideas For Deflation Defense

By: ETFdb
First, the good news: all those fears about runaway inflation following from the massive injections of capital into financial markets appear to have been overblown. Now for the bad news: the alternative may be much worse. For months wary investors have been eagerly watching CPI reports, fearful of the release indicating that price increases are beginning to accelerate, presumably spiraling out of control in the not-so-distant future. But instead of racing towards the double digits, CPI figures have slipped closer and closer to negative territory. That has sparked fears of deflation, a rare but serious economic condition that has some of the world’s most prominent investors legitimately concerned. PIMCO chief Mohammed El-Erian recently told Bloomberg that the U.S. faces a 25% chance of deflation and a double-dip recession. “I do not think the deflation and double-dip is the baseline scenario, but I think it’s the risk scenario,” said El-Erian. Jan Hatzium [...] Click here to read the original article on ETFdb.com. Related Stories: Five ETFs To Own During The “Great Deflation” Forget The Inflation/Deflation Debate: The Real Threat Is Biflation Ten ETF Ideas For 2010
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