Continue reading...Much has been written about the current bull market in gold and how it compares to previous moves, in particular during the 1970s when the metal soared to at the time unimaginable heights.
On this basis it is worth looking at the background to the value story on gold, and this may shed some light on why its bull market may have significantly further to go for CFD traders in coming years.
The Gold StandardThe UK, which at the time was the world’s dominant economic powerhouse, adopted a gold standard in the early 19th century. Other currencies then looked to have gold backing, and towards the end of the century, various European countries joined the standard, though some chose for a time use a joint gold and silver standard.
The emerging strength of the US saw it adopt the standard in 1879, by making "greenbacks" that had been issued during the Civil War period convertible into gold, and the gold standard was formalised by legislation in 1900. On the outbreak of World War One...
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