If you want to understand why gold is rising despite few signs of price inflation, it boils down to the understanding of how money is valued. The quantity theory of money, believed by monetarists, suggests that too much money chasing too few goods, will produce inflation in time.
The Fed is printing money like a drunken sailor, but the signs of hyperinflation are nowhere to be seen. Yet, despite this, the price of gold continues to climb. Why? People, on the margin, are becoming increasing skeptical of dollar ability to preserve value over time. Gold has not gone parabolic, often result of hyperinflation, because people have yet to believe en mass that the dollar "cooked" or worthless. There lies the basic description of the subjective theory of value of money as presented by the Austrian School of Economics.
Money is a game of perception and confidence. This is the main reason why everything can look so normal, right before the wall of confidence comes tumbling down and all hell breaks loose. Martin Armstrong alludes to this rapid progression in his commentary How all systems can collapse overnight.
Suggested Reading: kitco.com
Suggested Reading: How all systems can collapse overnight
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