How America Came off the Gold Standard

May 22, 2016

In our previous post, we took a brief look at the history of gold. For thousands of years, gold has been considered one of the most valuable materials on earth. In fact, gold was used to establish the value of currency. Even paper money! This was so for the United States until 1933 when President Franklin Delano Roosevelt took the United States off the gold standard. Interestingly enough, this may have only increased the value of gold! Let’s take a look at how the United States came off the gold standard.

The decision to come off the gold standard came during the midst of the Great Depression when economic hardship caused the public to begin hoarding gold. Prior to this decision, Roosevelt ordered all banks to cease paying out or exporting gold. Next, he ordered all gold coins or certificates valued at less than $100 to be turned in for cash at a price of $20.67 per ounce. The government quickly took in more than $770 million worth of gold. In 1934, the government raised the price of gold to $35 per ounce. This remained the same until 1971. It was, in fact, illegal for Americans to own gold bullion until 1974! All these changes were designed to bring an influx of gold into the United States, allowing them the money supply before uncoupling gold to the value of currency. These changes were in part credited for helping the United States crawl out of the Great Depression.

The result is that gold is more valuable today than it has ever been. It retains its status as one of the most beautiful, precious, and rare materials in the world. The current price of one Troy ounce of gold is valued at approximately $1,300.

At Stewart Kuper Jewelers, we are Tucson’s gold and diamond buying experts. We pride ourselves in our honestly and integrity. If you have unwanted gold, be it jewelry or other items, we encourage you to come in and talk to us about it. We pay up to 80 percent of the spot gold market for that day.