How to Profit from Gold
The Gold Reserve Act of 1934 prohibited private ownership of Gold and non public ownership. Gold could only be used for industrial purposes. The Gold Reserve Act of 1934 assured a fixed weight of Gold at 13.71 grains equal to one dollar or an ounce. This gold standard for the dollar stuck between the years 1934-1971. In 1971, Nixon raised the price to and again in 1973 to .22. Gold, Oil and Inflation affects the value of the dollar. There is not enough gold in the world to serve as the medium of exchange in international trade. The most popular currency for international exchange has been the dollar. The dollar is the leading currency. The dollar is the international currency for pricing and payment of commodities. President Nixon eliminated the 25% gold backing for Federal Reserve deposits. As soon as the dollar currency lost its gold backing, it became a commodity. The dollar as a commodity can be bought and sold on the market in response to world anxieties. The result of the dollar moving away from gold backing was a floating exchange rate that often invited over-speculation in foreign currencies. Banks could go broke from a price movement in the wrong direction. Supply and demand drove the exchange in relationship to other foreign currencies. Inflation occurs as the money supply increases faster than the output or Gross Domestic Product, the sum of a products and services in the US When government spends more than it brings in taxes is causes a budget …
the store 260 million ounces of gold with the us treasury and every ounce is guaranteed to be returned on surrender. central banks buy gold and act as if they never went off the gold standard. the wealthy buy gold as a protest of state capitalism devaluing the currency
Rhe wealthy buy gold as a means to escape State spending. Governments don’t produce wealth, they consume wealth. The wealthy never departed from the gold standard. They buy and sell bonds like gold. However, if government spending goes out of control, they buy gold like a central bank.
If I had money, I would buy gold immediately like all the other rich people. How did the rich know that the gold standard was correct? The wisdom of the crowds provides the immediate solutions. It took me alot of research to realize gold accumulation during inflation makes sense.
Gold maintains it’s originally value against the force of inflation. The gold cover clause states that a portion of the U.S treasury amount must be covered by gold in terms of dollar amounts not ounces. Gold value increases as price increases offset the inflationary affect.