I think the Fed has been trying to avoid deflation from the beginning. It seems they have taken action based on a greater fear of deflation than of hyper-inflation. It is a hard course to steer (this metaphor is particularly apt because like steering a boat you can steer all you like but the sea and wind may take you in a different direction). I suspect they will continue to take action that errs on the side of inflation. If that is wrong (they steer a middle course and are blown off course toward deflation) gold is the absolute wrong place to be.
I am betting on inflation. If things go toward deflation I suspect it will be better to own guns...
