We can all breathe a sigh of relief: Federal Reserve Chairman Ben Bernanke has said that there isn't a near-term risk for an inflationary spike.

For the most part, I can't help but agree with the Fed chief. As he noted, there is a lot of "slack" in the economy that will help prevent price inflation from rearing up in the near future. The "slack" basically means that for a wide variety of labor and goods, there is a lot of unused supply coupled with weak demand.

With a rate decision on tap for today, the Fed will likely use this "slack" as reason to keep its target rate at the 0% to 0.25% range where it's been hovering for a year now.

Interestingly, though, Bernanke also said that he doesn't see any sort of asset price bubble developing, saying specifically that "there is not much evidence to suggest that the stock market is currently in a bubble."

While overall price inflation is certainly a concern, for investors the prospect of easy monetary policy leading to asset bubbles may be the more pressing question. Since the beginning of the year, oil has come back significantly, while some metals like copper have had very significant runs. While this may be good for energy giants like ExxonMobil (NYSE:XOM) and Chevron (NYSE:CVX) and miners like Southern Copper (NYSE:PCU) and Freeport-McMoRan (NYSE:FCX), it could crimp profits at companies that use these products as inputs for finished products.

At the same time, the S&P 500 index has gained more than 60% since its March low, and the index is trading at more than 24 times expected 2010 earnings. Considering that between 1988 and 2008 -- a period that included the Internet bubble -- the index's average multiple was below 23, I find it hard to call today's valuation cheap.

Easy monetary policy could help spur the stock market even further, but I think investors may be best served by sticking with companies like IBM (NYSE:IBM) and CVS Caremark (NYSE:CVS) that have solid, stable businesses and still carry reasonable valuations.

An investor who doesn't make mistakes is likely an investor with no money in the market. Fellow Fool Dan Caplinger recently invited readers to share their worst investment mistake in 2009.