We are not on the brink of it. We are in the middle of it. Inflation is creating money faster than the market can absorb it with a stable price level. We have been explicitly doing that since Clinton's last year. Bush just called it "devaluation" and Adjustment in the exchange rates. What it is is classic definitional INFLATION. Prices have been rising more slowly than the rate of actual inflation would indicate(though faster than the published numbers)because China has been sopping up all the extra dollars. Instead of sending our "trade surplus" right back to us to purchase goods China has been buying government debt to build reserves, effectively taking those dollars out of the market and thus keeping the prices of Chinese goods low. Eventually this puts China in an economically scary position because it has to keep on buying those debt instruments, those excess dollars in order to keep its own economy going. The moment China begins to sell off its dollar reserves the prices of all the goods it sells will skyrocket as the exchange value of the dollar plummets. China will not do that until China is ready to make a major move that renders all the money finagling moot, like launching on Taiwan. If China seriously begins to sell off its dollars the 7th fleet had better be ready and in position and the boomers locked and loaded.
Of course, "gold" is a good investment. It usually is; but over the past few years it hasn't been so big and because the fast dollars have been in production of goods and services.
For months now, some posters in FR have been in the "RUN FER YER LIFE, INFLATION IS COMING, BRING OUT YOUR DEAD -- but Buy Gold First" Binge. It's nonsense.
Ditto.