Some say that China will be the next super power, replacing the position held so long by the United States.
Reading between the lines is something most can not do, but is required if you are to be successful in world markets. Watching China, and evaluating their moves can give you a good feel of what is going to happen globally, and within the precious metals market as well.
The recent closure of JP Morgans proprietary trading desk in London happened in tandem with $20 silver. Coincidence? sure… whatever makes you feel better. Now it’s time to keep an eye on Goldman Sachs, as they had the largest proprietary trading desk and have not decided what direction they will take before they are hit with the regulations brought down from the Dodd financial reform bill.
There is a mixture of opinions out there concerning palladium. Some say it’s breaking out and will not be coming down, others say it will break out, but must pull back first. “Stair steps is what is needed for a healthy climb to the top. Without the steps, a slight miscalculation, and you could slide all they way to the bottom very quickly.” One traders view on the metal.
China has treated the economic situation as if they learned from all the mistakes we made here in the U.S. They curbed mortgage lending when they saw the potential of a similar bubble in their real estate market that the Americans had, and are suffering through right now.
Now, Hebei, the largest steel making province in China has shut down 57 blast furnaces and production lines to insure the integrity of their power grid. This caused a spike in steel company stocks. Boosting these prices, is the possibility of 25 tons of steel capacity being suspended nation wide.
A comment that really caught our attention, and seems to be filled “between the lines”;