I think people are missing the point on what the drivers will be for inflation. USD weakness is not really a major factor (impact on imported commodities), nor is it excessive US debt (deflationary effect on domestic consumption -> USD weakness is deflationary on creditor consumption!).
Main US inflationary impacts will be
1) Energy prices (oil in particular) 2) Soft commodity prices (increased global demand with high weather risk of regional crop failures) 3) Hard commodity price increases due China/India demand (and for US weakening USD). 4) Long term unemployment leading to major deskilling of workforce and subsequent competition for remaining skills leading to large wage increases. 5) New Carbon tax (Emissions trading) will lead to one-off price inflation.
For 1 & 2 the US will gain a lot of the benefits as it is a main producer/exporter. 3 has less of an impact due to US being a mature industrialised country (as opposed to India & China). 4 is where the real risk is with **under** employment in US being circa 20% (considered to be double unemployment of 10%). If this lasts beyond a couple of years, there is a very real risk these potential workers will drop out of the skilled workforce - leading to a 70's style wage outbreak (competition for smaller skilled workforce).
Note also that for 1, 2 & 3 the inflationary impacts are global... so while for 1 & 2 the US will most likely be a net gainer, there will be an inevitable redistribution of wealth which will only worsen the plight of the poor & unemployed.
Personally I think the risk is stagflation from **2012** onwards as the full impact of high unemployment in the US comes to bear, and globally the excessive demand on soft commodities from China & India coupled with environmental/weather constraints/risk on crop production.
For hyperinflation I see this as more likely a risk for Japan not US for exactly the converse reason - excessive savings being unleashed too quickly (something like $500billion USD equivalent stuffed under mattresses for starters). And this is really a pyschology event rather than an economic one -> ie. the Japanese tend to act as one at the same time....
I hold a gold exposure not because of either inflationary or deflationary risks but as a function of political/institutional uncertainty. One could imply that gold has risen since circa 2000 mainly due to the political weakness of the US & UK and lesser extent Europe & Japan)... which unfortunately hasn't changed much as people had hoped...
