[0x8BADF00D]

You won't see it until it's too late. Inflation is a backward looking measure. Expected inflation can be inferred by nominal interest rates. If you look at the corporate debt market those rates are already quite high.

What happened in the oil market could easily happen in the gold market, but in reverse. Nobody wanted to take delivery on oil, but a lot of people are going to want to take delivery on gold, because there's a shortage of it. At what point does COMEX go bankrupt when nobody is honoring their word to deliver gold upon expiry?

A high gold price would be very bad for dollars, because gold is an alternative reserve currency to dollars. Instead of buying a tbill, someone can just buy gold, hold it, and sell a small portion when they need to buy dollar denominated assets, mainly crude. And crude prices are at historic lows, so you don't need to buy as many dollars as you did before.

[nradov]

What exactly is the mechanism by which Comex would go bankrupt? Commodity delivery contracts are still legally enforceable through the court system, although some civil cases may be delayed several months.

Gold is a commodity, not a currency. I can't pay my tax bill in gold.

[0x8BADF00D]

> Gold is a commodity, not a currency. I can't pay my tax bill in gold.

It was actually a currency longer than Federal Reserve notes were in existence. Not sure why you'd pay your taxes in gold, but you can, only it would be based on the face value of each gold coin.