In recent Federal Reserve testimony Chairman Ben Bernanke said ‘overall inflation is still quite low and longer-term inflation expectations have remained stable. … The Fed’s preferred measure of inflation, the personal consumption expenditures index, rose a modest 1.2 percent in the 12 months to December, the most recent data shows. Core inflation, which strips out food and energy costs and which the Fed believes is a better indicator of where inflation is heading, has been near five-decade lows.” Meanwhile the CRB Spot Commodity Index is at all time highs. When asked, consumers and company executives are reporting price pressures appearing everywhere. Food and energy prices are trending up rapidly and core inflation is increasing across the emerging economies. Who is correct – the Central Bankers or the markets? How can there be such a divergence between what the Federal Reserve believes and what the markets and the people on the ground are reporting? The problem arises because the Federal Reserve focuses almost exclusively on measures that relate to the unemployment and what the Fed describes as the “output gap” to predict future inflation – interestingly the money supply does not appear to factor into their thinking. Enquirica Research is a Calgary based research firm focusing on independent analysis of alternative asset classes, exempt market securities and investment opportunities, primarily in western Canada and particularly in agriculture and energy. Enquirica research is available on its website - www.enquirica.com. DISCLAIMER: The opinions, estimates, projections and other information which is contained herein and derived from or attributable to persons other than ENQUIRICA is neither endorsed nor adopted by ENQUIRICA – it is presented for informational purposes only. Further, the opinions, estimates, projections and other information contained herein are not intended and are not to be construed as an offer to sell, or a solicitation to buy any securities, including any exempt market securities, nor shall such opinions, estimates, projections and other information be considered as investment advice or as a recommendation to enter into any transaction or engage an investment advisor or exempt market dealer. Readers must contact their registered investment adviser or exempt market dealer for information that is tailored to their specific needs. FORWARD-LOOKING INFORMATION: This news release may contain certain information that is forward looking and, by its nature, such forward-looking information is subject to important risks and uncertainties. The words "anticipate", "expect", "may", "should", "estimate", "project", "outlook", "forecast" or other similar words are used to identify such forward looking information. Those forward-looking statements herein made by ENQUIRICA, if any, reflect ENQUIRICA’s beliefs and assumptions based on information available at the time the statements were made. Actual results or events may differ from those anticipated or predicted in these forward-looking statements, and the differences may be material. Readers are cautioned not to place undue reliance on any forward-looking information contained in this news release (if any), which is given as of the date it is expressed herein. ENQUIRICA undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise.

1. Enquirica Research – Central Bank Models versus the Real World and Inflation<br />Feb 14, 2011 Calgary<br />In recent Federal Reserve testimony Chairman Ben Bernanke said ‘overall inflation is still quite low and longer-term inflation expectations have remained stable. … The Fed’s preferred measure of inflation, the personal consumption expenditures index, rose a modest 1.2 percent in the 12 months to December, the most recent data shows. Core inflation, which strips out food and energy costs and which the Fed believes is a better indicator of where inflation is heading, has been near five-decade lows.” <br />Meanwhile the CRB Spot Commodity Index is at all time highs. When asked, consumers and company executives are reporting price pressures appearing everywhere. Food and energy prices are trending up rapidly and core inflation is increasing across the emerging economies.<br />Who is correct – the Central Bankers or the markets? How can there be such a divergence between what the Federal Reserve believes and what the markets and the people on the ground are reporting? <br />The problem arises because the Federal Reserve focuses almost exclusively on measures that relate to the unemployment and what the Fed describes as the “output gap” to predict future inflation – interestingly the money supply does not appear to factor into their thinking. <br />The Federal Reserve has conveniently concluded that no inflation is possible when those metrics are high - which they are currently. As their models tell them no inflation is possible, there is no reason to reduce the current pace of monetary expansion and therefore the bail-out of the banking sector can continue uninterrupted. The idea that the models and more importantly their entire framework might be wrong never enters Federal Reserve thinking. <br />The Federal Reserve and monetary authorities across the western markets seem willfully blind to the events of the 1970s and the possibility of stagflation that we currently face – high unemployment, low utilization levels but still high inflation. Prior to the 1970s central bank models said that this combination of events was impossible – of course it still happened, as reality does not respect faulty reasoning even when such august institutions as the Federal Reserve do it. <br />The 1970s are empirical evidence that stagnation and inflation is possible today, yet central bankers continue to choose to believe their models rather than look out the window at the real world. <br />Of course if they did, they would have to concede that their ongoing monetary activities will never benefit the real economy and are only serving to create inflation that is bad for the middle class but useful for the insolvent banking system. It goes almost without saying that this is an admission they are unlikely to ever make and so we can expect them to adhere to the “no inflation is possible when unemployment is high” mantra to the bitter and inflationary end.<br />Enquirica Research is a Calgary based research firm focusing on independent analysis of alternative asset classes, exempt market securities and investment opportunities, primarily in western Canada and particularly in agriculture and energy. Enquirica research is available on its website - www.enquirica.com. <br />DISCLAIMER: The opinions, estimates, projections and other information which is contained herein and derived from or attributable to persons other than ENQUIRICA is neither endorsed nor adopted by ENQUIRICA – it is presented for informational purposes only. Further, the opinions, estimates, projections and other information contained herein are not intended and are not to be construed as an offer to sell, or a solicitation to buy any securities, including any exempt market securities, nor shall such opinions, estimates, projections and other information be considered as investment advice or as a recommendation to enter into any transaction or engage an investment advisor or exempt market dealer. Readers must contact their registered investment adviser or exempt market dealer for information that is tailored to their specific needs.<br />FORWARD-LOOKING INFORMATION: This news release may contain certain information that is forward looking and, by its nature, such forward-looking information is subject to important risks and uncertainties. The words quot;
anticipatequot;
, quot;
expectquot;
, quot;
mayquot;
, quot;
shouldquot;
, quot;
estimatequot;
, quot;
projectquot;
, quot;
outlookquot;
, quot;
forecastquot;
or other similar words are used to identify such forward looking information. Those forward-looking statements herein made by ENQUIRICA, if any, reflect ENQUIRICA’s beliefs and assumptions based on information available at the time the statements were made. Actual results or events may differ from those anticipated or predicted in these forward-looking statements, and the differences may be material. Readers are cautioned not to place undue reliance on any forward-looking information contained in this news release (if any), which is given as of the date it is expressed herein. ENQUIRICA undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise.<br />For further information please contact: <br />Enquirica Research Inc. - “independent analysis of alternative asset classes and opportunities in exempt market securities”<br />Email: enquiries@enquirica.com<br />Web: www.enquirica.com<br />