What is the Gold Standard?

Commodity-based monetary regime that uses either circulation of physical gold bullion as commodity money or representative money backed by gold bullion. Non-fiat money based economies have trouble recovering after recession, as with the US after the Great Depression. This is because of the auspicious nature of precious metals, including gold. Precious metals have a lengthy mining process. While using representative money and commodity money controls inflation, it makes it hard to get more money into the economic system.

What people ask…

Why did the US go off the gold standard?
What was the gold standard and how did it work?
Why did Nixon remove the gold standard?
What happened to the gold standard?

See Also…

Bretton Woods system, Commodity, Commodity Money, Representative Money, Fiat Money, International Monetary Fund (IMF), Nixon Shock

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