Until I was age thirty, the price of gold was fixed at $35.00 per ounce. In 1971, Nixon devalued the dollar by 20% and fixed the price of gold at $42.00 per ounce. Now the price of gold is determined by supply and demand in the free market and is currently around $1600.00 per ounce. Throughout history, the rule of thumb was that an ounce of gold would purchase a good suit. I don’t know what a good suit costs today, since I stopped purchasing and wearing suits thirty years ago.
When I occasionally turn to FOX News, I am bombarded with ads for gold, sometimes at 1% over dealer’s cost. I don’t understand how the company can pay for national TV ads and still profit at 1% over dealer’s cost. The gold pitchmen remind me of used car salesmen. The companies they represent must be making their money with hidden extras, just as used car dealers, and new car dealers too, add warranties, tinted glass, and weather sealing to raise the price of the vehicle and their profits. I have never purchased gold so I don’t know how they operate.
- The Price Of Gold Doesn’t Matter (GLD) (businessinsider.com)
- Gold Is Not In A Bull Market (economicnoise.com)