Why not ?
Why should gold have any relationship to the Dow ?
The relation is descriptive, not prescriptive. That is, there is
a relation, not there should be
a (specific) relation. Gold bugs look upon this relation as one of their favorite self-justifying tools at times when either securities are expensive and/or gold is cheap. In historical terms, either presents an imbalance. And in finance, imbalances tend to resolve over time, this one included.
Over at the MW forums, the gold bugs tend to be among the stupidest contributors there. But now and again, their stopped-clock method of investing works in their favor. I merely pointed out above that the greater market has been betting against them recently.
The current war is not the cause of recent inflationary numbers.
Most certainly is; all deficit spending is. Not saying it's the only cause, or even the main cause. I don't know that.
Even if the feds want hyperinflation, what are the mechanisms available to make that happen NOW ? Japan's attempt to inflate failed once the deflationary expectations set in. The current window of opportunity could be closing fast.
Monetizing the debt appears inevitable at this point; it's the only politically-palatable "solution". Of course, it destroys the value of the dollar, punishing savers, bondholders, and people on fixed incomes.
We actually have a temporary reprieve, as the dollar would already be under sustained attack if we hadn't exported our recession, in particular to nations even more vulnerable than ours. (Now of course, exporting it was not a choice but an inevitable result of globalized finance.)
Inflation, though, is a tax every bit as real as the income tax, only far more regressive. Which might be one reason that partisans who are infuriated by taxation are often relatively (or completely) silent about inflation.
Note that the 'feds' have more weapons in their arsenal than simply lowering the FF rate. Bailouts are a good example. They are highly inflationary. (If I pay your mortgage for you, it frees up a lot of your money to be spent at Wal-Mart or the gas station.) You may wonder why we are not experiencing tremendous inflation then, when multi-trillion-dollar bailouts are coupled with a negative real funds rate. The reason is that underlying this is a severe, catastrophic deflation, rendered only partly visible thanks to these manipulations. And this would explain why the precious-metals markets remain in a funk. "Stuff" becomes vastly less valuable under these circumstances.
I'm still at a loss about how to predict, identify, or even describe the 'inflection point' that Bear and I have discussed, when a thing can switch to its opposite. That is, deflation turning to inflation. But Karl Denninger had something to say about that.