The best example of something is often called the "gold standard." It sets
the standard against which other things are measured. In
economics, the term describes how major trading nations once used gold to set
currency values and exchange rates. Many nations continued to use the gold
standard until the last century.
In the United States, people could exchange
paper money for gold from the eighteen seventies until nineteen thirty-three.
Then-President Richard Nixon finally disconnected the dollar from the value of
gold in nineteen seventy-one. From time to time, some politicians call for a
return to the gold standard.
But in nineteen seventy eight, the International
Monetary Fund ended an official gold price. The IMF also ended the required use
of gold in transactions with its member countries.
Since that time, gold
prices have grown. But the growth was uneven. Prices -- uncorrected for
inflation – continue near record highs. Gold is trading above one thousand six
hundred dollars an ounce. An ounce is about twenty-eight grams.
But people
keep buying. Some people are "gold bugs." These are investors who say people
should buy gold to protect against inflation.
People have valued gold for
thousands of years. The soft, dense metal polishes to a bright yellow shine and
resists most chemical reactions. It makes a good material for money, political
power -- and, more recently, electrical power. If you own a device like a mobile
phone or a computer, you might own a little gold in the wiring.
The gold
standard was the subject of one of the best-known speeches in American political
history. It took place at the eighteen ninety-six Democratic National Convention
in Chicago.
William Jennings Bryan wanted the country to use both gold and
silver as money. The idea was to devalue the dollar and make it easier for
farmers to pay their debts. Here is Bryan reading his speech much later, in
nineteen twenty-one.
WILLIAM JENNINGS BRYAN: "You shall not press down upon
the brow of labor this crown of thorns. You shall not crucify mankind upon a
cross of gold."
The speech made William Jennings Bryan famous. He was a
presidential candidate three times. But he never won.
