Bonds down. Gold up $17. Someone seems to think there is a whiff of inflation in the air. Sniff…sniff….

It was another stellar day for all the precious metals yesterday…gold, silver platinum and palladium. Gold was up a hair over two percent…and the other three metals were up four percent plus.

The ratio of the US budget deficit to GDP is at the highest it’s been at any point since World War II. Except there are no Nazis to fight. The only war going on is Team Obama’s war against capitalism.

Underground investor David Fessler, writing at Investment U, says the four best hedges against inflation are gold, inflation-adjusted Treasuries, energy stocks and commodities such as wheat, metals, cattle and fertilizer.

The problem is that the federal debt is rising – and will continue to rise – much faster than gross domestic product, which represents America’s ability to service it.

Currencies consolidate…  Brazil posts a surplus!  Dr. Marc Faber speaks…  High yielders rule! And Now… Today’s Pfennig!

Experts roundly agree that the recession is only a short-term blip in the long-term escalation of oil prices. And this time, there are 1.05 trillion reasons why oil is going to climb well past its peak last year.

What’s the true cause of inflation? Jimmy Carter underrated? Really? And what makes Von Mises right after all these years? Read on to find out…Thank you (once again) for all your excellent responses on the Obama-Carter connection. When your thoughts and comments roll in, my only lament is a lack of space in which to reply.

On the earnings calendar, as you can see from the ones I have listed there is a significant amount of retailers reporting this week. That’s only a partial list, here’s the rest: ANN, BJ, APP, DDS, HOTT, DKS, ARO, GPS, PSUN, NWY, ROST, and TJX.

What comes after a trillion? Inflation…and lots of it. Just about one year ago, in the May 8, 2008 edition of the Rude Awakening, your editors asked, “What comes after a trillion?” Today we know the answer: two trillion…and then three…and then four.