I'm in almost total agreement with all of this.
As to the Fed, not only is UE high and likely to remain high; but housing is punk; velocity is uninspiring (http://research.stlouisfed.org/publications/mt/page12.pdf
); and there is little likelihood that the current expansion would be sustainable without monetary support. In fact, Trichet yesterday seems to have implied that the zero bound is likely to stay in place for a long time...; and the ECB seems to be committed to unending metal to the pedal -- (hence Weber's withdrawal).
Here's a passage from EuroIntelligence from this morning:
Trichet says fiscal policy main tool against inflation. Is he announcing a policy shift?
Central bankers are trained not to say anything of any relevance in long speeches or interviews, and Jean-Claude Trichet is a master at this. So we were a little surprised when he told Die Zeit that governments should fine tune their fiscal policy in the fight against inflation. Here is the quote: "Individual countries must accept the monetary policy as a given and adjust their national policies accordingly... When a country experiences a boom, it needs to make its own national policies ... more restrictive in order to avoid the economy overheating or speculation getting out of control." The policy consensus has been for the last few decades that monetary policy is the instrument of choice to control inflation and inflation expectation, while fiscal policy should be oriented towards medium-term goals. Fiscal policy has a role to play in countries that overheat relative to the rest of the eurozone – like Spain before the crisis – but this is hardly applicable now. (If you consider Germany as overheating, there is not much you can do with fiscal policy to constrain the inflationary pressures, especially considering the time lags through which fiscal policy operates. We interpret Trichet’s statement as saying: monetary policy is currently constrained, so fiscal policy is all we have got. This is quite extraordinary, and makes us wonder whether the ECB is really determined to prevent an upward drift in inflation.)
All of which says to me that it is very unlikely that the Fed will want to tighten -- and that gold/silver/miners will continue to run for the next 3-4 months.
I also agree that when this ends -- the bear will resume -- though I doubt we have another full year to go.