The History and Future of Gold

Ever since 1971 the United States has had the ability to supplement tax revenues by accessing an endless supply of money via the Federal Reserve.  This ever increasing supply of money causes inflation.  The historical and forecasting data below demonstrates how drastically the price of gold has been impacted due to inflation.  Gold is the most stable asset in existence.  The purchasing power of gold does not fluctuate over the years.  It is the purchasing power of the dollar that fluctuates.

Year   Gold $/ozt
----  -----------
1800        20.65
1850        20.65
1900        20.68
1930        20.65
1933 --> confiscation of privately owned gold
1940        33.85
1960        35.27
1970        35.94
1971 --> removal of the gold standard
1980       612.56
1990       383.51
2000       279.11
2005       444.74
2010     1,224.53

@ 12.08% based from 1971
2015      2,352.95
2020      4,161.84
2030     13,020.57
2040     40,735.65
2050    127,444.02

@ 20.58% based from 2005
2015      3,152.06
2020      8,035.18
2030     52,215.11
2040    339,310.27
2050  2,204,945.18

Prior to the removal of the gold standard in 1971, the price stayed very consistent.  However, after the removal, the monetary system lost stability and has been undergoing large amounts of inflation.  As you can see, the years ahead nearly guarantee more inflation and higher prices of gold.  This is the reason why gold has always been considered one of the best hedges against inflationary fiat currencies.