Is it Possible the US Will Return to a Gold Standard?
With economies across the world fluctuating at alarming rates, it’s no surprise many experts are talking about a return to stability. For some economists, that means bringing back gold to standardize currencies from all nations. Based on information gleaned from speeches and reading between the lines of published policy intent, President Donald Trump may be siding with pro gold standard commentators.
Trump’s Personal History with Gold
Gold isn’t a newfound love for President Trump; he’s owned gold in various forms for years. He started investing in it in the 1970s as soon as it was legal to do so in the United States. In fact, Trump reportedly made over a 300 percent profit on some of his gold investments. That type of profit with gold is possible for anyone patient enough to hold onto it — you don’t have to be a billionaire or presidential candidate to benefit from the power of gold in your portfolio.
Could the United States Return to a Gold Standard?
Returning to a gold standard would be difficult, but not impossible, for many modern nations, including the United States. A successful return to gold-backed currency would likely require bipartisan support within the federal government, but it would also rely heavily on public buy-in. Reports and polling show that President Trump might have some support for a gold standard policy, but it’s early in his administration and he’d likely need additional support to make it happen.
As of 2015, close to half of the American public was undecided about whether a gold standard was the right move; a national McLaughlin & McLaughlin poll indicated that 46 percent of people were undecided. Of those who did have an opinion, though, 39 percent supported a return to gold standards.
Potential Benefits of a Gold Standard
Gold is a fixed asset, which means it creates a stable foundation for any currency based on it. When currency is tied to gold, the government is limited in how much money it can print, thus driving down inflation. Government debt and deficits are also more limited, since intelligent financial management doesn’t allow for creating deficits far beyond what existing gold supplies can support.
Returning to global gold standards provides even more benefits for productive countries. As nations create and export more goods, they are paid in gold, increasing their own reserves and allowing more money to be circulated without as much risk or inflation. A global gold standard also creates a potential resource advantage for the United States, which still has plenty of natural gold supply.
Boosting Personal Investments with Gold
Changes in the national or global economy can be slow moving and seemingly whimsical, but you don’t have to manage your own investments in the same way. If you’re building wealth or want to stabilize retirement savings to support your future, you should consider adding physical assets like gold and silver into your portfolio.