![]() ![]() ![]() Energy crises, soaring inflation, and high unemployment stagnated the economy.īy January 1980, the price of gold reached $2,234 per ounce in today’s dollars amidst an environment of double-digit inflation. In 1974, President Gerald Ford would once again allow the private ownership of gold bullion. dollar’s value in gold at a fixed value, abandoning the gold standard. On August 15, 1971, President Richard Nixon mandated the Federal Reserve to stop honoring the U.S. gold standard had risen to $42 per ounce in nominal terms, however a period of economic volatility would challenge and change U.S. Golden Bull #1: December 1969 – January 1980 The United States ensured an ounce of gold would be worth $35 in its currency-at least until the onset of a stagnant economy in the early Seventies led to the official end of any real gold standard. dollar the official global reserve currency. In 1944, the victorious Allied powers negotiated the Bretton Woods Agreement, making the U.S. In 1934, Congress passed the Gold Reserve Act which prohibited the private ownership of gold and nominally raised the price of gold to $35 per ounce. Roosevelt limited the private ownership of gold to discourage hoarding and encourage investing. In order to stem the flow of funds into gold and the depletion of government gold reserves, in 1933, President Franklin D. dollars for its equivalent value in gold, removing currency from the economy. In the wake of the 1929 stock market crash, investors started redeeming U.S. This threat would force the hands of governments to change the standards, as currency became more common and gold reserves more scarce. Governments would set the price of its currency against an asset to ensure the stability of prices, however if there would be too many claims against the underlying asset, that asset would run out and the currency would become worthless. While the price of gold may appear cheap in the past, adjusted for inflation it is not as low as you would think.
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