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Gold Price History
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Gold has been treasured by man for thousands of years. While the price fluctuates today, changing day by day or even minute by minute, the official US government price of gold only changed four times between 1792 and today. In 1792, the official US government price of gold was $19.75 per troy ounce.

Coinage Act of 1792

Alexander Hamilton proposed US currency be on the standard of bimetallism where gold and silver backed all US currency. According to the act, the ratio of gold to silver would be fifteen to one. Gold was $19.75 a troy ounce from 1792 until 1833. By 1834, the ratio of gold to silver had changed from 15:1 to 16:1. The official government price of gold also changed to $20.67 per troy ounce.

Gold Standard Act of 1900

Enacted March 14, 1900, the Gold Standard Act ended bimetallism. The Government felt it had secured enough gold in its reserves. In effect, silver was no longer backing United States dollars. Gold would be the sole backing of the US dollar until 1972.

Executive Order of 1933

In 1933, gold was officially $20.67 an ounce. Under executive order of President Franklin D. Roosevelt, all Americans were required to turn in all gold bullion, gold coins and gold certificates to a federal reserve bank in return for paper currency. The penalty for violating the order was $10,000 fine or ten years in prison, or both. Although no one was ever fined or imprisoned, not everyone complied, as is evident by the many pre-1933 coins available today all across the country. It would be 39 years before American citizens were allowed to own gold once again. Gold was set by the US Government at $35 an ounce in 1934. While this did lower the national debt, it also dropped the value of the dollar by 58%.

Two-Tier System

In 1968, the two-tier system was created. In the first tier was the Government trading at the set price of $35. The second tier was for all other trading (non-government), in which gold was free to change based on supply and demand. At that point, there were two different prices for gold. The free market value was about $39.00 per ounce.

In 1972, Richard Nixon effectively ended the gold standard, putting the dollar on the Fiat system. The price for gold was also upped to $38 per troy ounce. For the first time since 1933, American citizens were allowed to buy and own gold. The official US government price for gold was changed for the last time in 1974. The price was set at $42.22. Since then, any transactions using gold by the US Government have been at this set price.

Conclusion

The official price for gold has only changed four times, but has been changing constantly since 1972. As long as there is a demand for gold, people will continue to buy it. Because it has the ability to maintain value while currency does not, makes gold very attractive to collectors and those wishing to buy gold to expand their portfolios.


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