Longwei Petroleum (fka LPIH)

[rru2s]

PRC Printing Money in China: Stimulus will help growth

I think central bank injection of liquidity will increase investment spending in construction in Shanxi, which already has a good deal of ongoing construction (Joe Natural visited Shanxi personally a couple months ago and can attest to the pace of construction). Further liquidity injections should therefore boost sales of oil and gas in 2012 and 2013.

"China Joins Liquidity Party"
From SeekingAlpha article, "Three Reasons to be Bullish on Emerging Markets"

http://seekingalpha.com/article/899721-3-reasons-to-be-bullish-on-emerging-markets

"If you can fog a mirror, you have heard about money printing from the Fed and ECB once or twice in the last few months. Central banks are injecting money directly into the financial system. According to the Economic Times, China has started to print as well."

"SHANGHAI: China's central bank injected a net 365 billion yuan ($57.92 billion) into money markets this week, traders said, the largest weekly injection in history, as regulators struggle to maintain liquidity without producing inflation as forex inflows slow." (Source - Reuters Sep 27, 2012.)

"As shown in the chart below (FXI/S&P 500), China has been lagging the S&P 500 in 2012. The green arrow shows the recent liquidity injection may enable FXI to break the current downtrend."

"Asia Breaks Out"

"The Asia Ex-Japan ETF responded to the liquidity injections from China's central bank. The chart below shows the performance of AAXJ relative to the S&P 500. The chart has a bullish look with several trendline breaks, a healthy RSI (bottom), and a big base below."