Gold Price History

You have probably noticed that the price of gold is on the rise. Have you ever wondered to yourself why it is so valuable?

Originally gold was used to create coins, whereas today it is desired mainly for its beauty. Gold was eventually replaced by paper money, which was originally created as a simple receipt for your gold coins. Basically, if you had $3 in paper money it would be used to represent that amount of gold.

The value of gold, currently around $900 an ounce, has fluctuated greatly over the years based on its investment value on Wall Street. This, however has not always been the way it works.

The US government had originally fixed the price of gold so that one ounce equaled $20.67. This changed in 1934 when the dollar was devalued to equal a $35 ounce of gold.

A system was eventually created so that even though the $35 per ounce value was maintained, gold was still able to be bought and sold on the private market, thus allowing its price to continually change. In 1975, gold finally became entirely a free market investment.

The fluctuation in the price of gold in the last 30 years has been remarkable. Since 1975, the price of gold has varied from as low as $200 an ounce to an amazing $1,000 an ounce – reached twice in the past year. In 1980 the price of gold topped out at $850 per ounce, which at the time was a record high. That number has obviously since been surpassed, but if you factor inflation into the mix that would be approximately $2,176 in today’s market, which would easily be the highest gold price of all time.

After peaking in 1980, the price of gold remained pretty stagnant, fluctuating between $250 and $500 an ounce for 26 years. The price of gold has not dropped below $700 an ounce or risen above $1023.50 an ounce since September of 2007.

For a single day in 2009, gold topped the $1,000 an ounce barrier but has since remained around $900 – $950 through the first quarter. Many experts speculate that the price of gold will continue to rise during these troubling economic times as history proves that the value of gold does rise as the dollar weakens.