His cautious case for commodities comes from low prices, tight inventories, reviving demand, new markets in developing nations and investors' assumption that inflation is dead.

The United States has pressed Japan to revive domestic demand so the country will export less and import more, reducing its huge trade surpluses.

If the governments acted in concert, he said, they could revive domestic demand, which would reduce their export dependence on the United States and Europe.

Letting the peso slip in value could revive demand for its exports, which are now undercut on price by neighboring Brazil and other countries.

But after post-9/11 problems prompted airlines to reduce the size of their fleets, a strong economy has revived demand for business and leisure travel.

The Treasury calculated that this would allow interest rates to tumble, which would revive demand.

The solution: the Fed cuts interest rates to revive demand.

The Federal Reserve can probably revive demand by lowering rates, as it has in the past.

To be sure, the deficit could expand again if the dollar soars, which could revive demand for imports and hurt exports.

Unless governments accept a devaluation of their currencies against the D-mark, they have limited room to cut interest rates to revive flagging demand.