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September 14, 2009

September 14, 2009 – Gold and silver spot prices experienced pullbacks on Monday as the Dollar strengthened for the first time this month. Gold and silver, along with other commodities, rise with inflation. When US currency rises in value, commodities like precious metals, fuels, and food tend to cost less.

The Obama administration has laid out a plan to ensure that another economic collapse does not happen, and many financial institutions are balking at the proposals. Some banks, like JP Morgan Chase and Goldman Sachs, are already putting back into practice some of the investment strategies they implemented before the fiduciary meltdown, including investing in risky and exotic financial products as well as low-yield bonds. Many investors believe that this is a strategy for failure, as exotic markets are not currently at the top of consumers’ "To Spend On" lists, and bonds are projected to devalue to the point of losing pricipal. Banks, insurance companies, and other large financial institutions are loosely regulated in terms of how much capital must be liquid, volume of high-risk investments allowed, and credit allowances. The majority of federal law that regulates how businesses operate is unchanged from 2008 because of attempts by lobbyists and opposing lawmakers to prevent reform. Instead of investing in stocks that have decreased dramatically in value over the last two years, many investors are looking at simple commodities like gold and silver, which historically survive and thrive during rough economic periods.

Gold fell early in the trading day before rebounding slightly later in the afternoon trading session. At 5pm EST one ounce of COMEX gold was selling for $1000.90, a $5.20 drop for the day. Silver rang in at $16.54 at the same time, down $0.19 from an opening level of $16.73. Gold and silver can be tracked live at www.goldprice.net, and gold and silver numismatic coins can be price-checked at www.PCGS.com.

Shannon King

Senior Staff Writer – GoldSilver.org

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