The U.S. once kept its currency attached to the price of gold. This didn’t change until President Nixon took the U.S. off the gold standard and established a floating currency exchange rate. This created the Forex industry as we know it today. While gold is still considered amongst the most valuable resources on Earth, the dollar is no longer directly tied to it. This has had an interesting result on the worldwide economy. For one, the dollar has not lost out on its status around the world. The U.S. dollar is the most widely traded currency in the world, accounting for roughly 80 percent of all Forex transactions.
The second interesting fact is that the dollar is accepted now purely on the world’s implicit faith in its value. Without being connected to the value of gold, the dollar is essentially just a piece of paper distributed by the United States government. Consumers around the world take this fact for granted. The dollar has its value simply because the government has approved it for this usage.
Forex traders value the dollar because of its worldwide appeal. It has remained a stalwart of safety throughout the decades since the cancellation of the gold standard and will continue to bring value to investors and traders alike, even with the current worldwide debt crisis. Although you can’t take your dollars to Fort Knox and exchange them for some of the nation’s gold reserves, you can still use dollars around the globe to buy and sell.
See more on the Gold Mining Millionaire to determine your next trade in Gold.