Gold: the oldest store of value.

How it works

Gold produces no income: no rent, no dividends, no interest. Its price is set by supply and demand from jewelry, technology, central banks, and investors (physical bars and coins, and gold-backed ETFs). People hold it as a "safe haven" or diversifier, not for cash flow.

History: $35 an ounce, then the gold window closes

Under the Bretton Woods system (agreed in 1944, operational from 1958), U.S. dollars were convertible to gold at a fixed $35 an ounce. A London market run pushed the price to $40 on October 20, 1960; the London Gold Pool formed in 1961 to defend $35 and collapsed in March 1968.^[1]

On August 15, 1971, President Nixon closed the gold window: foreign governments could no longer swap dollars for gold, and the system became, in effect, fiat money.^[1] Since then, gold's dollar price has floated.

Recent documented data

The WGC also reported US-listed gold ETFs added 437t in 2025, taking holdings to a record 2,019t, followed by outflows in Q1 and Q2 2026.^[2]

Watch out: risks

• No cash flow: returns depend entirely on someone paying more later.
• Volatility & flows: the WGC itself documents sharp swings in ETF flows quarter to quarter.^[2]
• Storage, insurance & dealer spreads for physical metal.
• High prices hurt demand: WGC notes jewelry volumes fell as prices rose.^[2]

Sources

1. Federal Reserve History, "Nixon Ends Convertibility of U.S. Dollars to Gold"
2. World Gold Council, Gold Demand Trends

Fetched Oct 13, 2026.