Monetary Watch June 2011, Inflation prospects post QE II

``Will private banks lever up, at least enough to keep the monetary inflation party in flight? Again, as discussed HERE, we think it depends on what long-term interest rates do next. If they rise, a real possibility because of the end of QE II, we would not be surprised to see a profit-starved banking system give it a go, especially in a world of guaranteed, near zero short-term funding rates. ''