Due to its scarcity, gold became valuable in the early history of the world. In about 2700 BC, gold was struck into gold coins by Egyptian pharaohs. These coins were used mostly as gifts and not for trade or business. It wasn’t until about 700 BC that gold coins became a primary standard for trade. Gold remained the primary standard until 1931. To prevent hoarding of gold brought about by the Great Depression, President Franklin D. Roosevelt signed Executive Order 6102, which forbade the ownership of gold beyond a small amount. The Gold Reserve Act of 1934 standardized the price of gold from $20.67 per troy ounce to $35.00 per troy ounce. This price stayed in effect until August, 1971. Then in 1974, President Gerald Ford made private ownership of gold legal again. Since then, gold has risen to over $900.00 per troy ounce.
Investing in gold should be looked at as a hedge against inflation or stock market failure. Gold will never pay dividends, but will always have value. There may come a time again when stocks and bonds are worth next to nothing. It has happened to a greater or lesser degree several times. In those times, gold still has value. If nothing else, it can be used to barter for things you need.
Gold also has a nice feel to it. Stock and bond certificates may look nice, but they still feel like paper. Gold has weight and feels good when you stack it. This brings about a certain amount of pleasure and satisfaction.
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