" Inflation is NOT the issue. The markets know it (why else would US bonds and Treasury notes be in such demand) and the Fed (as always) is following the 3 month US treasury bill down the lowering yield path. I believe that the US Treasury market is telling the real story.”

IMO Inflation may not currently be the issue.  The US may be in a recession.  The Fed has reacted by huge increases in the money supply & making the cost of credit cheaper.  The result will bring increased demand for commodities.  The US is no longer the only engine of growth.  Do you remember how Japan had deflation problems & kept lowering interest rates until they reached close to 0%?  We know that money spread throughout the world because of the recent publicity given to the unwinding of these credit swaps.  Until US business  picks up Fed cheap money will find its way to grateful recipients all over the world.  Either way commodities are on a tear & will continue.  Do you believe the current inflation figures we are being fed?  

From memory I think it was 1974 when the US went off the gold standard of $37. for 1 oz. of gold because they could no longer deliver.  Their position is 100 times worse today. IMO The US can't return to the gold standard barring a complete collapse of the monetary system.  If that happens gold would head skywards. 

Regards

Joltin