Commodity Trading & Trend Following

One guess who has been buying gold bullion since 2003? This has not been for gold charms or gold necklaces.China has purchased approximately 454 “TONS”. Could this be one of the reasons gold prices have soared since then? China’s track record of investments has been poor of lately as one can look how they purchased BlackStone.

I am far from being negative. However,I find it questionable to believe all the statements coming out of the FED that the bail out has worked and we will avoid an economic depression. Hopefully we will only encounter an economic recession. An economic recession is healthy and wrings out the excesses of the economy.

Premier Wen Jiabaoג€™s credit plan or Bail out has possibly started to kick in to the worlds third largest economy China. The prices of commodities such as copper and zinc are breaking out. The increasing demand for commodities and products from around the world should be an impetus for growth. Is this just a natural cycle or could Premier Wen Jiabaoג€™s 4 trillion yuan or $585 USD billion stimulus package be the savior of the global recession?

Maybe it is me but will all these huge numbers…a billion dollars here…a trillion dollars there.. my head was starting to hurt. I do not think I am alone with these worries… except for an ostrich with it’s head in the sand. I would believe that most people would agree they have a hard time comprehending the actual numbers involved.