Gold Reserve Act Of 1934

A controversial and borderline unconstitutional act passed by the Roosevelt Administration that seriously interfered with how gold was used in the United States.

Let’s rewind to 1934, when Bonnie and Clyde were road-tripping and robbing banks and Radio Flyers were all the rage. FDR had been elected President two years earlier and had promised to make some sweeping changes; the Gold Reserve Act was just one of those changes.

It accomplished two things:

1) It made the U.S. Treasury the only legal owner of gold and gold certificates, thereby making it illegal for every other person or business to own gold or gold certificates; everyone had to turn over their gold and gold certs to the U.S. Treasure (don’t worry...they were compensated for it).

2) It changed the price of gold from $20.67 per troy ounce (“troy ounce” = unit of measurement for precious metals) to $35 per troy ounce.

In a nutshell, what this means is that the federal government seized all the gold for itself and then magically made it worth 40% more, thus giving itself a huge boost to its bottom line. “Seems legit,” said no one ever. (Except FDR and his crew and the SCOTUS that upheld the act.)

By 1974, the last vestiges of the Gold Reserve Act were dismantled and Americans were once more allowed to buy and sell gold.