After gold's breathtaking $38 surge in 15 minutes Wednesday, there is much renewed interest in the Ancient Metal of Kings. The Federal Reserve, which is clearly being run by lunatics, publicly announced it is going to create over a trillion dollars out of thin air to monetize U.S. debt. This degree of pure monetary inflation is utterly unprecedented.

But gold always stays ahead of the rising inflationary tide. New mining only adds 1% to 2% to the global aboveground gold supply annually. Yet even before this week's monetization announcement, the Fed grew the U.S. monetary base by an astounding and frightening 88.1% over the past year. With vastly more dollars bidding on relatively far less gold, a rising gold price is the inevitable result of this inflation.

The prospect of unbridled monetary inflation rightly terrifies investors. Mountains of cash, the highest relative and absolute levels ever, languish in money-market funds earnings zero interest today due to the Fed's interest-rate manipulations. As monetary inflation accelerates, this capital will suffer increasing real losses of purchasing power. So the natural defense against this central-bank predation is to move capital into gold.

Thanks to gold's inflation-driven surge this week, a lot of traders are starting to discuss a new gold upleg. They are right, a gold upleg is coming, but they are late to the party. Today's gold upleg started way back in the dark days of November when gold neared $700.

With gold's fundamentals incredibly bullish today, GLD certainly isn't the only way for stock investors to ride gold higher. At Zeal, we have always enjoyed gold-stock investing and speculation. The best gold stocks, unlike GLD, can really leverage the underlying gains in gold. And provocatively, today the gold stocks are radically undervalued relative to gold because residual fears from the stock panic have really frightened the traditional gold-stock traders.

While the big gold producers will thrive, the truly epic gains will only arise in the junior gold stocks.

The bottom line is gold is indeed in a new upleg. But this week's inflationist-Fed announcement, while it will accelerate this gold upleg, certainly didn't ignite it. Gold has already been powering higher for over 4 months now. This upleg's technicals have been textbook-perfect and very bullish. The Fed-driven inflation spike, while exciting, is merely a blip within this already well-established uptrend.