gstatic.com serves static Googel files; like their Javascript, CSS and images and it's kind of wrong to black that. It functions as a CDN that caches most of the things that Google uses such that they don't have to serve it from google.com itself as that would be very costly in network performance.
You don't need to block that domain name as there really is no point in doing so. Another maintained hosts file that you can find is http://someonewhocares.org/hosts/zero/
Perhaps you could consider to combine both hosts files provided in these answers, first try replacing 127.0.0.1 by 0.0.0.0 because that's a better approach at blocking (it doesn't do requests to the local host) and if that doesn't work then replace in the reverse direction.
I'm heavily against extensions that process your web pages as in comparison to a DNS change that really slows down your browser experience as it obstructs the download/process/render loop...