fxmade2trade
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Since late 2012 to gain the confidence, popularity and trust of the people the powerful communist Chinese government decides to issue anti-graft and anti-extravagance measures. This created such a massive change for how and what is being produced and imported that a systematic chain reaction in other markets such as property, Gifts, travel and now all automobiles purchased by government must be domestic branded vehicles so the stream of Bentley, BMW and Mercedes are no longer allowed as government vehicles. Even liquor and spending on events are limited Xinhua News Agency reported that all levels of government will be barred from using government funds to organize extravagant galas staged with expensive celebrities and performances. Officials will punish organizers of “expensive or wasteful celebratory events.” Ah yes and now we have seen first hand gold declining and this ban is campaigned to lead in to 2017. according to a report by Bain & Co., China’s growth in luxury spending dropped from 7 percent in 2012 to just 2 percent in 2013, the slowest pace since 2000.
The Hurun Report, a publication that chronicles the wealthy in China, said in its 2014 Luxury Consumers Survey that compared to 2013, 25 percent fewer respondents plan to give a “very expensive gift” (worth $826 or more) at Chinese New Year. Additionally, since Xi’s austerity campaign, China’s high-end hotels have experienced considerable drops in their occupancy rates. Before the campaign, government bookings accounted for more than 40 percent of sales for business hotels. Now, business has fallen by more than 50 percent. Now we cannot forget many things attributed to these statistics, and money is still being spent, the Chinese are still spending and spending a lot. The money is for now outside of china and with more focus on strengthening the middle class in China this just means investors need to look at what moves the middle class and focus on that. Just so I am being clear I can’t foresee the middle class buying up large chunky gold watches, and Cartier jewelry in the near future. India will once again be the main consumer of gold and with the Diwali festival in October, physical gold is being smuggled in at an alarming rate, as well as the fear of the Scottish independence fueling fear, explains the buying spree of physical gold coins in the U.K.
Once again and don’t let the statistics run your trading, much of the information is altered and the Reserve Banks withhold information and Central Banks foresee intention of consumers, and traders. In fact the Chinese have been trying to gain the upper hand in the pricing gold, and away from London for some time and it seems their efforts may pay off. For now, gold is bearish and I am holding short.
The Hurun Report, a publication that chronicles the wealthy in China, said in its 2014 Luxury Consumers Survey that compared to 2013, 25 percent fewer respondents plan to give a “very expensive gift” (worth $826 or more) at Chinese New Year. Additionally, since Xi’s austerity campaign, China’s high-end hotels have experienced considerable drops in their occupancy rates. Before the campaign, government bookings accounted for more than 40 percent of sales for business hotels. Now, business has fallen by more than 50 percent. Now we cannot forget many things attributed to these statistics, and money is still being spent, the Chinese are still spending and spending a lot. The money is for now outside of china and with more focus on strengthening the middle class in China this just means investors need to look at what moves the middle class and focus on that. Just so I am being clear I can’t foresee the middle class buying up large chunky gold watches, and Cartier jewelry in the near future. India will once again be the main consumer of gold and with the Diwali festival in October, physical gold is being smuggled in at an alarming rate, as well as the fear of the Scottish independence fueling fear, explains the buying spree of physical gold coins in the U.K.
Once again and don’t let the statistics run your trading, much of the information is altered and the Reserve Banks withhold information and Central Banks foresee intention of consumers, and traders. In fact the Chinese have been trying to gain the upper hand in the pricing gold, and away from London for some time and it seems their efforts may pay off. For now, gold is bearish and I am holding short.
