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Fresh off the presses from David Franklin (of Sprott AM) is this commentary on gold. He says that China and India might account for half of annual gold demand last year.

While he takes some assumptions later in the article his point is valid - growth in demand in China is rampant and encouraged by the government. Chinese have nowhere to put their savings. Real interest rates are negative and property is high. Gold serves the people's interest and also the government's interest - a potent combination.

In a historical context, China has been the world's vacuum cleaner of silver for centuries and that hose is being turned back on - in this case to escape the inflation that Bernanke is forcing onto the Chinese.

This has been part of my argument for gold from the beginning- that as power shifts away from the US you'll see transitions to alternate money to reflect that newfound power. This is manifested now as citizens and the government seek to avoid the perpetual Fed devaluations.

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