There is a possibility of higher inflation down the line (when the economy starts performing better, it is not a problem now) because of all the money that has been pumped into the financial system. (Bernake claims the FED has a plan to deal with this, but I don't really trust them). If you have a longer time investment horizon(over 5 years), you might want to take a look at Treasury Inflation-Protected Securities (TIPS). They are not good if you have a short horizon because inflation is low right now.
You get coupon payments based on the inflation adjusted face value, and you always get the face value in case of deflation, so your downside risk is protected (i.e. you are guranteed your principal back if Uncle Sam is not broke