Create address labels from gmail contacts in google docs?

Is there a way to create a address labels in google docs based on my gmail contacts (even better would be a group of contacts I made). Essentially allowing me to easily create all my address labels for mailing out invitations or christmas cards or whatever in just a few steps.

From web app jschoen

• 1. It seems to me if you use the Print option in the contact manager.
  2. You can select to print just addresses. That opens a new browser window and formats it for printing.
  3. Use 'Ctrl-A' selecting all the information, including headers.
  4. Paste it into Excel.
  5. Save the Excel file.
  6. Run a mail merge using MS Word.

  It seems like a lot of steps but it works rather smoothly and doesn't take much time at all. Once in the mail merge labels you can reformat the font just about any way you want.

  jschoen : @Josh Thanks for those steps. But what I was really looking for was a solution to do this with Google docs. This is definitely the next best solution though.
  From Josh Curren