You're assuming the direct connection between the price of gold and inflation. The only reason there is a noticeable correlation is because of the late '70s. Inflation shot up for a host of reasons but gold shot up for a very specific reason... Nixon closed the gold window ending the Bretton Woods system in 1971. It was the beginning of fully, global fiat currencies but also the beginning of American demand for gold on the world markets. For 40 years ending in 1974, Americans and been unable to trade gold. From 1974 to its peak in 1981, the greatest consumers in the world got to work driving up the demand for gold.
Take out that specific period of time and there is very little correlation to assume that a low price of gold must mean economic calamity. Frankly, if you followed the trendline for inflation, you would have conclude that gold is way overvalued--even by an inflationary standard.
