Without having the data that the fed has, I'd say deflation is what I would worry about. Not sure if gold rising will lead to inflation, as the prices of pretty much all other commodities is falling hard. Gold seems to be a flight to quality play like t-bonds.
I'm just watching t-bonds go nuts and commodities getting shellacked, is all. You have to remember that growth has been fuelled by CC's and home equity lines. That is all going away, so consumer spending will be cut down, because the current situation is unsustainable. Lower US consumer spending = Lower US growth = Lower world wide growth = Lower commodities + higher unemployment = possible deflation. I'm not sayind deflation is going to happen, but inflation seems to be in check right now.
Yes, anybody paranoid about inflation in the short-run needs to do their homework on banking crisis http://www.investorsinsight.com/cfs...0_the_5F00_box/jmotb100108image002_5F00_2.gif inflation should be the end result but only because the fed prevents something worse
The Baltic Dry Shipping Index is now down 65% in the last 3 weeks alone! Can you say DEFLATION??? http://www.bloomberg.com/apps/quote?ticker=BDIY:IND