by John Galt
January 17, 2012 05:20 ET
The ChiComs broke out the heavy weaponry but then again, didn’t yours truly say they could do this? Yes, I did and reports are that China injected $30 billion into their equity and financial markets to insure that the selling would be stemmed regardless of the economic figures manufactured by the government. The one consistent result when governments monetize debt like the EU and Federal Reserve and interfere in the natural direction markets wish to go is that gold skyrockets and sure enough, the powers that be created a floor under gold once again as inflation is better than reality as this chart shows:
The markets today are poised to rally as the “risk on” nonsense is back into the lexicon. With the ChiComs buying a 4% rally in the Shanghai index, look for U.S. markets to rally about 1 to 2% today as well as a broad based commodity rally.
Too bad the deflationary risks of a European collapse are being forgotten because all the fiction created by economic reports by the world’s governments do nothing to create solvency for nations who are about to experience a debt induced collapse which ultimately will end the bazooka party long before the average person gets their first risk on martini.
Follow JohnGaltFLA
Read all my posts, updates, Tweets, etc.