From Barron,s, 02-27-08:

There is a remarkable parallel between annual CPI inflation and the cumulative change in the price of gold measured from eight years before.

Historical CPI data in the U.S. are complicated by occasional changes in the methodology the government uses to calculate the index. In the late 1990s, one of these changes reduced the reported inflation rate significantly.

But taken as a whole, the relationship suggests my following rule of thumb to estimate CPI inflation at any time: Divide the percentage change in the gold price from eight years in the past by 80, and add three. This rule of thumb has largely worked over the past several decades. In the last eight years the price of gold has risen 225%. The rule therefore comes out with an answer that puts inflation a lot closer to 6% than 4%.

David Ranson, Head of Research, H. C. Wainwright & Co. Economics.
 

Currently the rule of thumb calculation is 5.94%.

Regards,

Lew