Gold is the metal we'll turn to when other forms of currency don't work, which means that gold will always have value in difficult and good times. United States Geological Survey, statistics and information on gold. We need it for too many things to lose its luster as a raw material and as an investment. Gold has a long history of being an infallible asset in times of economic uncertainty.
It was even the basis of the world's major currencies for half a century, when the “gold standard” was preferred as a way of guaranteeing value. From an investment point of view, in addition to being worth more, gold has always maintained its value in the long term. When stock markets crash, savvy investors with diversified portfolios rely on their gold reserves to make up for any deficits. The most advanced early civilizations (such as the Greek, Egyptian, Roman, Aztec and Inca) were located near areas with high gold yields.
And a key index that tracks the performance of gold mining stocks fell to a more than two-year low. Both scenarios lower the price because the first requires companies to innovate and design an alternative to gold. In 1973, foreign governments allowed currencies to float; this put an end to Bretton Woods and the gold standard was abolished. Therefore, for a president of the United States to unilaterally return the country to the gold standard, the country would have to exponentially replenish its gold reserves in advance.
The currencies were linked to the price of gold and the US dollar was considered a reserve currency linked to the price of gold. The Internet is still full of blogs that shout rudely and that shout that the sky is collapsing with respect to gold, but the truth is that gold will always have value. But are there any innate properties that make gold so valuable? Well, as a metal it is substantial, durable, versatile, portable and divisible. Although some gold-plating methods have existed since approximately 600 BC.
C., modern science has perfected the process and its main use is for gold-plated jewelry. The prices of those goods and services, including gold and silver, can fluctuate depending on market conditions. Several household devices, such as HDMI cables and the core of computer processors, contain gold because it easily conducts electrons. Under the gold standard, transactions no longer have to be made with heavy gold bars or gold coins.
But if a future president decided to do so, what would it take? According to Kimberly Amadeo of The Balance, due to trade, the money supply and the global economy, the rest of the world would also have to return to the gold standard. Despite the courageous efforts of the governments of the time, the Bretton Woods agreement caused the US dollar to overvalue, raising concerns about exchange rates and their relationship with the price of gold.