Historically, the United States used gold and silver to support its currency and permitted citizens to exchange cash for precious metals. Since the dollar was tied to gold and silver prices, the Federal Reserve could not create additional dollars without raising metal prices and possibly triggering bank runs. The financial system eventually moved officially to fiat currency. The article argued that this reduced emphasis on financial discipline and let central banks create more money while sharply increasing national debt. It then reviewed U.S. money supply and worldwide precious-metals mining.
Changes in National Debt and Money Supply
During the country’s first half-century of history, the Revolutionary War, the War of 1812, and the Civil War produced the largest changes in U.S. national debt. In that era, each Federal Reserve dollar was backed by gold and silver. Franklin Delano Roosevelt effectively ended the domestic gold standard in 1933 through Executive Order 6102, requiring citizens to sell most gold to the Federal Reserve. Over the next five years, federal borrowing to lessen the Great Depression’s effects increased national debt from $19 billion to $36 billion.
At the time of publication, national debt had continued upward and stood above $21 trillion. Similarly, U.S. money supply (M2) had surged since 1933, rising from $32 billion to $18 trillion.
How Much Gold, Silver, and Platinum Exists?
Over the preceding decades, improved mining technology had increased worldwide precious-metals production. The original article gave these estimated above-ground totals for gold, silver, and platinum as of 2019:
- Gold: 5.6 billion ounces, valued at about $10.4 trillion
- Silver: 3 billion ounces, valued at about $73 billion
- Platinum: 8 million ounces, valued at about $7 billion
Because these metals last so well, above-ground totals offer rough estimates of all gold, silver, and platinum ever mined. The article concluded that, as of 2020, all global gold, silver, and platinum was worth under half the national debt.
Does Investing in Precious Metals Make Sense?
At publication, Precious metals are finite, and industry experts had begun asking whether a turning point had arrived. Industrial-scale mining had continued for nearly two centuries, and many major mines were approaching the ends of their lifecycles, potentially making gold, silver, and platinum more valuable. The article suggested that a return to commodity-backed currency could cause dramatic price increases because debt exceeded national precious-metals reserves. It also described precious metals as helping diversify investment portfolios by guarding against inflation and retaining value through downturns.
At publication, readers interested in precious-metals investing were invited to connect with Atlanta Gold & Coin Buyers for advice and a transparent appraisal involving gold, silver, and platinum bullion. The article reported decades of industry experience and familiarity with coins, bars, and ingots. Readers were invited then to schedule an appointment by calling (404) 236-9744.
