NOISE! China's GDP growth is nothing new. China has been growing by leaps and bounds for the better part of this decade. The rest of the world should be afraid of China. The 21st Century is China's for the taking. And western economies are going to be steamrolled by the Chinese. Hank Paulson and the Dumbasses in Congress want a stronger Chinese currency. Well, they're about to get one. And at the expense of the US Dollar, they're going to be sorry for what they wished for.
LONDON (Thomson Financial) - Oil fell by nearly 2 usd in New York on worries global growth could be slowed if Chinese authorities try to rein in inflation.
NEW YORK, April 19 (Reuters) - U.S. gold and silver futures fell sharply early on Thursday, hurt by a host of factors including worries that a possible rate hike in China could cool off the global economy, a stronger dollar and technical selling.
SAN FRANCISCO (MarketWatch) -- Gold futures dropped $5 an ounce Thursday to close at their lowest level in a week, as news of faster-than-expected growth in China in the first quarter triggered worries that the government will have to take measures to slow down its economy, reducing demand for metals.
There's a world of Dumbasses out there: "global growth could be slowed", "a possible rate hike in China", "triggered worries" ...these are the words of Dumbasses. Look up Economist in the dictionary, and I'm certain there will be a picture of a Dumbass next to the definition. When was the last time the Chinese listened to a "suggestion", or followed advice, from any Western Economic Dumbasses?
Chuck Butler of Everbank and The Daily Phennig sums up today's "shocking" economic news out of China:
Well... Overnight China posted their first quarter GDP... I'm chuckling right now, because once again the economists and market observers got China all wrong! They collectively said that China's economy would slow down, and that's what really led to the mid-term pause by the commodities last year... China slows down, their demand for commodities/raw materials dries up, and so do their prices.
But... Something funny happened on the way to the forum... These economists and market observers got it all wrong! China's first-quarter GDP grew even faster! HAHAHAHA... That's right... China's economy grew at 11.1% vs. the previous year... (the previous quarter's growth was 10.4%) How's that for your Sunday picnic? It's like I always say... These people don't know what's going on in China... Oh, they go there, and they think they know it all... But we all know that they know about as much as Bullwinkle! Did anyone that forecasts GDP for China even come close to that 11.1% gain? No sirree, Bob!
So... Anyway, I'll get off my soapbox now and just talk about China for a minute... Investment in China continues to be off the charts... And now something that I've warned about for sometime now is beginning to take shape... Inflation in China has accelerated to 3.3%. The Chinese Central Bank does have a ceiling target on inflation of 3%... So, obviously this exceeds that ceiling... I wonder what the Chinese will do about this?
Well, you know my solution... It's the same one that I've had for as long as I've been warning about the surging inflation in China... And that would be to allow the currency to strengthen... A strong currency goes a long way toward keeping inflation in line... Look what it did for the U.S. in the late '90s and into the new millennium... The U.S. economy was rock and rolling, and the dollar was strong... Inflation wasn't the problem it is today, with the dollar much weaker, eh?
When it all adds up, the amazing 11.1% growth in China is going to throw gasoline on the fire that's already lit under commodities...
Silver held it's 50 Day Moving Average today. It is bullish when the 50 day Moving Average asserts itself as support in a rising market. Silver was hammered mainly because of the dump in oil today IMO. The dump in oil today was amusing...again look for a quick rebound. The brave that stepped up to the plate today and bought the dip in Silver should be commended. If you sold today and turned tail and ran...don't come back.
Gold moved down less than 1% today and painted a nice tail on today's candle keeping this current rally leg alive. The US Dollar remained weak the entire day, and as I type this it is sitting at 81.41 on the US Dollar Index. Today's China GDP number is great for all Commodities and Precious Metals...despite what the Dumbasses say.
Silver Resistance: 13.69 / 13.77 / 13.82
Silver Support: 13.52 / 13.39 / 13.23
_______________________________All Prices Spot
Gold Resistance: 686 / 691 / 699
Gold Support: 681 / 677 / 672