Here are three questions to ponder over in the summer season: Is inflation back? When will Japanese interest rates start rising? Do global imbalances matter?

These questions will determine whether we will have a nice and quiet second half of the year or become embroiled in turmoil of major proportions.

As for the first question, one answer is that inflation is and has already been back with us for quite some time. As far as the upper end of the production stream is concerned, that is.