Tough talk on inflation, first by US Federal Reserve officials, then by Jean-Claude Trichet, president of the European Central Bank, has got the markets rattled. Last week all the leading equity indices retreated, with the S&P 500 down 2.7 per cent, the FTSE Eurofirst 300 down 1.8 per cent, the Nikkei off 2.6 per cent and the FTSE 100 off 2.1 per cent. It looks as if investors are questioning the notion that the US, and to some extent the world economy, has entered a new "Goldilocks" phase with growth neither too hot (risking accelerating inflation) nor too cold (risking...