Gold Investing - An Important Anniversary For Gold

Today is the 40th anniversary of the U.S. dollar's link to gold going away. President Nixon made this announcement on August 15, 1971. Up to this point, foreign governments could exchange their U.S. dollars for gold at $35 per ounce. When this became a problem, the gold exchange window was closed and the dollar became a fiat currency. Inflating the money supply became possible and that is the course that has been followed. And hasn't that worked out well for us all!

In the "olden days" gold was money and when you thought of money, you thought of gold. I remember my Dad telling me he sold a car back in late 1920's for five $20 gold coins. Can you imagine trying to buy something today with a gold coin? People are becoming more aware of the value of gold but there is still a long way to go. And that is why I think this gold bull market has a long way to go also. Richard Russell thinks so too.

Richard Russell is considered the Godfather of newsletter writers. Here is what he had to say in a recent King World News Blog entry: "When chaos reigns, people look for certainty. When all is lost, only one item stands supreme and has been supreme for thousands of years. That item is gold."

He believes that, with the current state of affairs, gold will reach $2000 shortly. Once that is reached, the next objective for gold is $2500, then $5000 and from there - eventually $10,000. You can read the blog entry here.

The mid-August numbers from the U.S. Mint for gold are as follows:

one-ounce gold eagles - 69,500, year-to-date 638,500;
half-ounce gold eagles - 3,000, year-to-date 61,000;
quarter-ounce gold eagles - 4,000, year-to-date 68,000;
tenth-ounce gold eagles - 40,000, year-to-date 305,000.

Spot gold stands at $1764.30 at the time of this post - up $170.20 for the last 30 days with a gain of $538.80 for the last year.

Thanks for reading.