To answer this question we must return to the beginning of this saga.
Throughout history, gold has played two roles – decorative and monetary – that have reinforced each other. Gold gave power because of its unquestionable beauty and indestructible, but this power was much greater than gold gained more importance as a currency.
However the seeds that would lead to the loss of its status or change appear very early in this story. Innovation inadvertently paper currency Hien Tsung, in the ninth century, was the first step. Substitutes more effective in the coinage then came the Middle Ages, with the increasing use of credit money as bills of exchange and the parallel development of banking activities. From the seventh century, the growth of trade and production had caused a growing and urgent need for cash. Over time, gold proved to be a handicap more effective an instrument for conducting business.

The gold, which rises almost by accident in the nineteenth century explicitly recognized this shift in terms of gold, which rose less frequently from hand to hand. Now most of the remaining monetary gold, on the contrary, in the vaults of the banks as collateral security for the Supreme paper currency and bank deposits used in commercial transactions and financial growth. Gold was established as the standard absolute and unassailable protection – a guarantee that politicians do not trigger riots by creating more abstract forms of money and causing inflation wild as was so often the case in the past . In 1928, George Bernard Shaw, that can not be suspected of conservatism, perfectly summed up this attitude in his Guide of capitalism and socialism to the use of intelligent woman: “You must choose between putting your trust in a stable natural of gold or the honesty and intelligence of members of the government. And, except the respect due to these gentlemen, I advise you, as the capitalist system works, to vote for gold. ”

Even the central role of gold was condemned in advance. The impatience of politicians was not the only force that would lead eventually to the burial. The outcome was written in both the magnitude and complexity of financial activities in general and the functioning of governments in particular. It appears increasingly irrational to manage a global financial system with a metal sources were arbitrarily distributed by nature, the main of them are located in countries with questionable regimes also as Russia and Africa South. Gold had become an anachronism.
Measured from 1870 until in 1971 when Richard Nixon found the last link with gold as qu’étalon and protection, the longevity of the gold was a fraction of Besant the Byzantines. Christopher Columbus, John Locke, David Ricardo and Montagu Norman would have been much surprised to discover that their eternal truths are not as eternal as they thought.

And yet we can not be certain that this saga is nearing its end. In 1875, as we have seen, the distinguished English economist Stanley Jevons warned that “men are held responsible for so little damage they do to money that is not a good thing to leave your Management at their sole discretion. However, management discretion is precisely the system that the world has chosen to replace the constraints imposed by the gold. Finally freed from the golden barriers, all countries of the world now work with monetary systems and currencies are convertible into anything other than the currencies of other countries, all without cost, simply by pressing buttons on a keyboard computer. We have more money that can be tested with a touchstone to determine whether it is genuine.

Many people think that the dollar is the glue that holds the system together, as did the gold in the past. Today, in other words, the U.S. dollar seems to play the same role on the international scene that played by the British pound in the nineteenth century. But after the Second World War the gold reserves of Britain had long been exhausted and the supply of pounds sterling was so superior to their request that their value plunged.
The dollar is no more metal than was the sterling and it is not different from the currencies of other nations. It is simply that the rivet is still in the system at the beginning of the twenty-first century. No central rivet has never lasted indefinitely, not even gold.
The idea is widespread that the dollar has made the law not only because of the tremendous economic power of America but also thanks to the extraordinary skills of financial that have succeeded at the helm of the U.S. central bank — the Federal Reserve system. An article by Floyd Norris in The New York Times on 14 May 1999 was entitled “Who needs gold when we Greenspan? “. This title reflected a widely shared view in our time.

Let us recall the observation of Benjamin Disraeli in 1895: “Our gold standard is not the cause but the consequence of our commercial prosperity. “In the same way, central bankers from all major countries of the world may appear to be competent in the years 1980 and 1990 because the economic conditions of these years showed competent. There was no major international conflict could trigger inflation. The inflationary pressures caused by the welfare state had been suppressed by the dismantling of part of social safety nets and the obsession to squeeze the budget deficit, not only in the United States but also in Europe, in a good of Latin America and Asia. The world economy was fiercely competitive, and U.S. companies were the most competitive of all. Known oil reserves during these years were much larger than in the early 1970s. In short, in the late twentieth century, no irresistible force did to test the actual skills of central bankers nor shook the dollar in its dominance. The best save is gold or maybe gold coins.

Let us remember also the comments of Marco Polo on the currency of Kubla Khan: “The production of the currency of [Kublai Khan], he wrote, is organized so that we can really say that he has mastered the art of alchemy … The process of emission is also formal and official only if it was pure gold or silver money … … This is genuine currency, the Khan has such quantities that could s ‘he wanted to buy all the treasures of the world. “If Marco Polo was still with us, he would no doubt observe the remarkable resemblance between the U.S. dollar and monetary emission Kublai Khan. Yet we are not more assured of the permanence of the dollar hegemony as the increased dominance of paper money to Kublai Khan, the pennies of Offa of Besant, the dinar, the ducat, or the pound sterling . During periods of inflationary fever in the late 1970s and early 1980s, people frightened and even those who knew turned away dollars to go to gold. In periods where such unavoidable turbulence reappear, history may well repeat itself. The gold markets are developed and active.

As Robert Mundell, Nobel Laureate of Economics in 1999, he was out receiving his prize in Stockholm, “the main thing that is missing today is a universal currency, a standard of value, the link between past and future, and the glue that connects the different communities from each other. ” He continued by reminding his audience that gold had fulfilled this role since the time of Augustus until 1914 and that “the absence of the gold as intrinsic part of our monetary system today makes this respect, our century – one that has just ended – unique for several thousand years. ” Mundell expressed his thesis with emphasis, but the lack of universal currency will continue to be a wound to the global economy until the problem is not resolved.
In March 1997, well before that he would one day be honored by the Swedish Academy, Mundell made the following prediction: “Gold is an element of the international monetary system in the twenty-first century. “It was a bold statement and controversial, disturbing, too. Gold may be again the ultimate protection in a chaotic period. The return of gold to its traditional role as the universal currency, however, is unlikely unless the dollar, the euro and the yen kept all three being means of payment accepted internationally.

The history of gold has a more profound, which is not attached to the ephemeral qualities of what we choose as a currency. In a broader sense, the history of gold has no end.
The most striking aspect of this long history is that gold is tripping most of the protagonists of the drama. One after another, the characters have behaved as the passenger of Ruskin who drowned grabbed his gold, and they discovered too late that it was gold that had. Midas, Jason, God, the Byzantine emperors, the survivors of the Great Plague, Pizarra and Emperor Charles V, MacArthur chemist, Montagu Normaiì and Benjamin Strong, Charles de Gaulle and fanatics of the gold of the 1980s – all were inhabited by the obsession with gold, but they were in pursuit of an illusion. None knew the fate that he hoped.

Those who thought that gold was a protection against the uncertainties of life did not understand that the quest for eternity can not be satisfied with gold, or any other substitute: dollars, euros, or what you want. Gold as an end is absurd. The Hoarding does not create wealth. Gold and its surrogates have meaning only as a means: to beautify, to adorn, to exchange against what we need and that we really want.
Perhaps the most wise heroes of our history were ordinary people of Timbuktu and Jenne that exchanged in silence gold against the precious salt they needed to live. Get more information about gold coins here.

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