>>7540469In fact, "dollar" originally was a unit of weight, like a pound (like how the currency in England is called the pound, get it?)
Since the American Revolution a dollar was defined as 1/20 ounce of gold. If you had a one ounce gold coin it was stamped $20.
If you had paper money equal to $20, you could get it as gold. this was all true from the 1790s until the 1933. In the depression president FDR "revalued" the dollar as $35 is 1 ounce of gold, at the same time he made private ownership of gold coins and bullion illegal and individuals could no longer trade their dollars for gold, though big institutions and foreign governments could still exchange dollars for gold at a rate of $35/ounce. This held true until 1971, when president Nixon suspended the ability to trade dollars for gold. Ever since, the dollar has nothing at all to do with gold.
So, gold had a fixed price of first $20 per ounce, then $35 per ounce. Now the market price of gold is $1350 an ounce. You could have bought gold for $35 in 1971, and sold it for $1350 today.
Anyway, the banks and the government did not like the gold standard, because they could only create new money to the extent they had enough gold to cover exchanges (not 100%, just enough to cover demand).
Now there are no limits, the gov and fed can create as much money as they think the economy will bear, which enriches the gov and the banks at the expense of the common people.
