Investing in Gold and Achieving Our Glory
 
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It is important to grasp the big picture of why gold is going up and the factors that are fueling its rise.

An Overview Since 1974

In 1971 President Richard Nixon ended US dollar convertibility to gold, bringing to an end the central role of gold in world currency systems. Three years later Congress legalized the ownership of gold by US citizens. Freed from the government-mandated price of $35 per ounce, the dollar and gold floated. In 1979 and 1980, investors' lack of confidence in the government's ability to restrict the expansion of the money supply resulted in panic buying of precious metals as a hedge against inflation. Gold prices soared, and in January 1980 the gold price hit a record of $850 per ounce. During the four-year period from 1976 to 1980, the price of gold had risen by more than 750%.

In the early 1980s the US Federal Reserve raised interest rates to restrict money supply growth. This policy achieved its purpose and by 1982 interest rates were declining and the fear of inflation had subsided. Investment capital responded by moving into financial assets from commodities including gold, and the market soared. After the historic highs of January 1980, the price of gold meandered in the $300-$400 range until hitting a low of $256 in February 2001. Then the bull market for gold returned, and by November 2009 the price had pushed up to $1,140 - a rise of 445%. To some investors, this suggests that history is repeating itself and gold is heading beyond $2,000 per ounce. To return to the 1980 high, when adjusted for inflation, the price would need to be over $2,000 now.


 
 
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While bullion dealers the world over provide services to investors wanting to put their money in gold bars, some major banks in Switzerland, Austria, Liechtenstein and Argentina buy and sell them over the counter.

Many sized bars are available and are measured in troy ounce, tola or tael depending on the country it is bought from and they can be either personally held or with bank in a safe deposit box.

It is a big hassle moving around with the bars or storing and transporting them which has made the gold account a preferred system of holding for small and medium investors. 
Gold accounts offered mostly by Swiss banks help investors buy and sell gold or gold bars easily like foreign currency.

While Gold Money account has been in operation since 2001 providing digital gold currency, there are also Digital Gild currency and the Bullion Vault, both similar in operation. All these gold accounts have different set of rules for their clients and their gold investment through a trust or Bailment.