After QE3 Inflation Measure Jumps

Today's FT (Septermber 18, 2012) reports a jump of the market expectations for the US inflation. I have found a nice chart on bloomberg.com of the development of expected inflation (calculated using 5-year treasuries):

Break even rate: difference between the yield of treasuries and the inflation protected treasury debt

The FT sports another graph over a longer time period:
 

 The market sees a higher risk of increased inflation over the coming years because of the ultra expansive monetary policy of the Fed (QE3). The Fed seems to focus more on unemployment than on inflation. Accordingly the US Dollar traded lower and gold higher.

On June 3rd, 2012 the FT reported an even worse development taking place in secret:
Debt cancellation by central banks 
US, UK and Japan's central bank would cancel government debt on their balance sheet to reduce the outstanding government debt:

Just look at the amounts. They are just breath taking! What this means is a permanently increased monetary base, which will lead to higher inflation, if the central banks cannot take the liquidity out of the system in due time. Remember that there is a significant time lag of six months between central bank action (e.g. raising interest rates) and its effect on inflation.

I guess the Euro area will face inflation too, since Mr Draghi's recent declaration go in the same direction.

Investors have to protect themselves against these inflationary risks: long term bonds will be hit hardest. Stocks will also be hit, should inflation be above 4.5%. Only gold, commodities, and maybe real estate as well as gold mining stock will provide cover.