Chinese Purchases Pushing Up Price of Gold!

Chinese investors gobbling up gold bullion


By Daily Crux Editor Sean Goldsmith:

Investors in China, the world's second-largest gold consuming country, are stepping up purchases of physical gold as a hedge against economic disaster... "Gold demand in China in the first quarter rose to 114 tons, up 2 percent over the same period last year, solely boosted by an increase in jewelry demand," according to the latest report from the World Gold Council.

Chinese investors are taking a cue from their government, which increased its gold reserves nearly 76% to 1,054 tons since 2003, and will likely continue buying as the dollar continues its death spiral and the renminbi becomes more internationalized... "China's gold reserves may serve as backing for the yuan as Beijing is stepping up the promotion of its use overseas," said Albert Cheng, director of the World Gold Council's Far East Division.

Note: China is rightly scared to death that its holdings of US Bonds will disintegrate in value as inflation takes hold in the US. The prospect for which is HUGE, considering the Trillions of dollars in bonds the Govt and the Fed have issued to fight the deflation in this country.

They are buying gold as protection against inflation and the possible devaluation of the US dollar.

This is pushing up the price of gold and my favorite, silver. Over recent months, gold has gone from about $895 to $985, a nice move. Silver on the other hand has gone from $10 to $15 an increase of 50%. For more info on why I feel silver is the better investment, click here: http://silverpros.blogspot.com/2008/11/why-silver.html for more information
on "why Silver" including a video by Robert Kiyosaki on Investing in Silver.