Price of Gold and the American Dollar

Is the price of gold really going up? Well, first off let's look at the price of gold. In 2000 the price of gold was around 325 dollars per ounce. Then in 2005 the price of gold went to 405 dollars per ounce. Now in 2008 the price reached an unbelievable 910 dollars an ounce, shattering the 1980 record of 850 dollars an ounce. At first glance it might seem that the price of gold is actually rising. But when you look out of America you will see that gold is not really going up else where at the rate that we see here in America. So what is making this precious metal rise like it is?

The truth is that the price of gold is not really going up as much as the charts that you see on the news or on the internet. It's the power of the American dollar that is really going down. For a while now the power of the dollar has been going down. During this period the price of gold has been slowly rising steadily, in relation to the American dollars decline. To give you a little more insight of the situation, for the first time in 2007 the American dollar was actually worth less than the Canadian dollar. This was the first time that this had occurred in the history of the country. Before 2007 many places around the world where Americans would go on vacation would accept American dollars in there stores or restraints. Then in 2007 many places in several countries around the world stopped taking American dollars. Before they would take the American money then exchange it later. Now you have to exchange the American dollar before you go out in the other country. Even more evidence of the declining dollar is occurring in our very own country. In New York City many stores are now posting signs saying that they will now accept euros, the European currency.