Chinese Inflation & a Declining Dollar Fuel Gold Higher

China & the Dollar are again effecting the price of precious metals. China has taken a page from US inflation policy,  giving price increases in housing greater weight than the increase in food prices.  Often lending to the miscalculation in real inflationary numbers; this type of calculation has been used for years to keep the cost of living increases artificially low on retirement benefits. Gold & silver is not hurt by this miscalculation, in fact, they benefit by holding buying power steady, out-performing cost of living increases.

As we have seen recently,  Tunisia & Egypt riots have been fueled by the increase in food pricing.  World governments continue to ignore the effect rising food prices have on the overall economy gold & silver will continue to keep pace providing the same buying power. Read more here on CNBC: Gold Rises on Chinese Inflation & Declining Dollar.

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