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Roosevelt confiscated gold held in banks (in exchange for dollars) and subsequently diluted the dollar, but it was still pegged to gold. Nixon closed the gold

• dragontamer 5y ago
  > Roosevelt confiscated gold held in banks (in exchange for dollars) and subsequently diluted the dollar, but it was still pegged to gold. I mean, legally pegged to gold was meaningless since holding just 2-kg of gold was illegal IIRC. EDIT: Just reread the executive order: 5-oz was the cutoff point. IMO, Nixon's actions just "admitted" that the price of gold was no longer pegged to the dollar. But making gold "hoarding" illegal was really the pragmatic step that decoupled gold from the dollar. The (black) market price of gold vs dollar went haywire after Roosevelt's executive order. And in many respects: the market price (even black-market prices) are more important than what the law actually states.
• leereeves 5y ago
  > Roosevelt confiscated gold held in banks Not just the gold held in banks. Roosevelt made it illegal for American citizens to own more than a trivial amount of gold (with a few exceptions like jewelers and coin collectors). Afterwards, as you said, dollars could be redeemed for gold at the new price, but only by foreigners.
  • chrisco255 5y ago
    Yes, but he didn't send federal agents around to people's houses to confiscate any gold they might have. Prior to that executive order, presumably, most Americans kept their gold in bank deposit boxes. In my opinion that executive order should have been overturned as unconstitutional. But Roosevelt owned the courts.
• ineedasername 5y ago
  It doesn't really matter if currency is pegged to the price of gold when the government determines what that price is.