Do we have to have gold in reserve to back up the money we print as a nation?
I thought we had to have gold to finance the money that is printed but if this is the case where do we buy the gold and how do we finance it.
Answers:
The US is no longer on a gold standard, not since FDR changed it in the 30's. Our money is backed by the US Government's word now.
No, the UK no longer has any gold reserves as the current government gave these to the European Central Bank. In any case gold reserves were never equal to the amount of money in circulation and the pound has long since been decoupled from the Gold Standard.
I think that for a while it is not gold, but the gross domestic product that is used to back up a currency, nationally and internationally. And anyway, in the country, the money is just a token, a contract between the recipient and the giver.
i don't just loads of good quality paper
It's a good point, I mean a £5 note is only a toked, should a photo of a £5 note be worth just as much?.
not any more ,bretton woods accord was abolished in the seventies by Nixon look it up on wikipedia
We don't have any gold in the UK Gordon Brown sold it cheap to win an election.
Money used to be linked to SILVER, not gold. The pound sterling was a promise to pay one imperial pound of silver (in weight) to the bearer of the note BY the bank of england. This was when pound notes were huge, people had never seen a fiver, and the penny was the size of a 50p. (With decimalisation, in the mid 70's there were no longer, silver sixpences. Some remained, in use, until there were declared NON legal tender. they were initially made of silver, then other white metals. In the late 70's silver shot up in value, and like many kids, we obtained sixpences, sorted the silver ones out, and sold them, to antique/coin/scrap gold dealers, as they were worth more in silver (margianally) than you could buy them for, from a bank!)
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Answers:
The US is no longer on a gold standard, not since FDR changed it in the 30's. Our money is backed by the US Government's word now.
No, the UK no longer has any gold reserves as the current government gave these to the European Central Bank. In any case gold reserves were never equal to the amount of money in circulation and the pound has long since been decoupled from the Gold Standard.
I think that for a while it is not gold, but the gross domestic product that is used to back up a currency, nationally and internationally. And anyway, in the country, the money is just a token, a contract between the recipient and the giver.
i don't just loads of good quality paper
It's a good point, I mean a £5 note is only a toked, should a photo of a £5 note be worth just as much?.
not any more ,bretton woods accord was abolished in the seventies by Nixon look it up on wikipedia
We don't have any gold in the UK Gordon Brown sold it cheap to win an election.
Money used to be linked to SILVER, not gold. The pound sterling was a promise to pay one imperial pound of silver (in weight) to the bearer of the note BY the bank of england. This was when pound notes were huge, people had never seen a fiver, and the penny was the size of a 50p. (With decimalisation, in the mid 70's there were no longer, silver sixpences. Some remained, in use, until there were declared NON legal tender. they were initially made of silver, then other white metals. In the late 70's silver shot up in value, and like many kids, we obtained sixpences, sorted the silver ones out, and sold them, to antique/coin/scrap gold dealers, as they were worth more in silver (margianally) than you could buy them for, from a bank!)
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