In gold, they trust

“Our guess is that if the chairman of the Fed is determined to debase the currency, he will succeed”

11/22/2010 | Tony D’Altorio, Investment U

On August 15, 1971, thousands of years of gold’s role in monetary history came to an end.

That was the date President Nixon cut the U.S. dollar’s final link to gold. With that move, the age of fiat currencies began in earnest. The U.S. dollar became backed by only “the full faith and credit of the U.S. government.” And advocating a role for gold in the global monetary system officially became fruitless.

Today, advocates still compare current central bank policy to massive money printing. After all, the beauty of gold is that no one can make any more of it.

Nobody listens to those crazy gold bugs though. Don’t expect that to change, even with Robert Zoellick, president of the World Bank, recently saying that the precious metal might be ready for a comeback role in the global monetary system.

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