Washington, D.C. (JFK+50)Eighty-two years ago today, June 5, 1933, the Congress of the United States, on the recommendation of President Franklin D. Roosevelt, passed a joint resolution ending the right of creditors to demand payment for goods and services in gold.
The United States had been on the gold standard* since 1879, but the large number of bank failures during the Great Depression had led to the hoarding of gold.
The congressional resolution had the effect of increasing the power of the Federal Reserve to inflate the money supply. The decision of the President and the Congress followed actions taken by Great Britain just two years earlier.
By the resolution, "all gold coins and certificates" could NOT be exchanged for gold. It also required the delivery of ALL gold coins, gold bullion and gold certificates to the Federal Reserve by the first day of May, 1933 at the set price of $20.67 an ounce.
By May 10, the federal government had collected $300 million in gold coins and $470 million in certificates.
The United States completely abandoned the gold standard in 1971, by order of President Richard M. Nixon. His successor, Gerald R. Ford, however, signed a law allowing American citizens to own gold bullion.
*Gold Standard: a monetary system in which the standard economic unit is based on a fixed quantity of gold. In 1785, the United States adopted a silver standard based on the Spanish milled dollar, but by the Mint & Coinage Act of 1792, both gold & silver coins were made legal tender.
"FDR takes US off gold standard," This Day in History: June 05, www.history.com/