Lesson 02 · Gold

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

2025: total demand topped 5,000t, with 53 all-time price highs in the yearSource: World Gold Council, Gold Demand Trends Q4/FY 2025
Q1 2026: demand 1,231t, record value US$193bn
H1 2026: demand 2,522t (+2% y/y), record value US$380bnSource: World Gold Council, Gold Demand Trends

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

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.

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