A bit of history on Gold investing

As the economic crisis continues many people are seeking the safety of gold investing. While all assets, including precious metals such as gold may lose value, gold is still a popular way to store wealth. It is tangible, portable and timeless in appeal. In the past it was illegal to own gold in the United States. Gold coins were confiscated and removed from circulation during the Great Depression.  In 1933 owning gold bullion (jewelry not included) became illegal.

On April 5, 1933, newly inaugurated President Roosevelt issued Executive Order 6102, which prohibited the “hoarding” of gold by U.S. citizens. Americans were required to turn their gold holdings over to the federal government at the prevailing price of $20.67 per ounce.

This drastic action, which has been criticized by many, was deemed necessary to fight the great depression. Effectively what it did was transfer a large amount of assets to the federal government in trade for worthless paper money at a fixed price per ounce. This was the beginning of the end of the gold standard, which tied the value of the U.S. dollar a fixed amount of gold or silver.  Finally in 1974 it became legal to own gold bullion again.