The catalyst for the next global recession is in view after a series of false starts. Inflation data in the U.S. spiked to 3% in February to a post Lehman high. Housing, insurance, clothes, restaurants and medical bills are all rising. It appears as though the endless rounds of money printing are finally working their way through the system?

Historically the only way to kill inflation is to raise interest rates. This time is different because the U.S. economy would simply collapse if interest rates reverted back to their historic average. In 1980 and 9 years after Nixon closed the gold window Paul Volker raised interest rates to 20% to kill inflation and save the U.S. dollar. With U.S. government debt now exceeding $19 trillion, this simply is not an option.

Between 1979 and 1980 the gold price surged from $320 to $850 as policymakers fought to kill inflation.