Gold: Shiny and strong, but what about its bite?
The precious metal looks set to test $2,000 an ounce while the gold bugs try talk it to $2,500 and beyond
In 1971, when then president Richard Nixon took the US off the gold standard, the metal, which had driven the conquistadors on a blood-spattered surge across the Americas, was trading at $35 an ounce.Tricky Dick needed a cure for the rampant inflation then hacking at the economy like a Spanish swordsman, so the move was not immediately aimed at putting the future of the world’s financial system in the hands of rapacious, market-rigging, small-people-crushing, cocaine-hoovering, private-jet-flying one-percenters.It did, however, hasten the fall of the Bretton Woods monetary system, under which 44 of the world’s most prosperous countries settled their international balances in dollars. The currency in turn was convertible to gold at the fixed rate — $35 an ounce.The end of the gold standard was the crack into which the ancestors of the one-percenters could thrust a crowbar and — eventually — lead the world helter-skelter into a scary forest where unwholesome plants such as sub-prime...
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