Gold Reserves Law . Law passed by the Congress of the United States the 30 of January of 1934 , by which the official price of $ 20.67 is repealed troy ounce in force since 1834 (with exposure period ( 1865 – 1878 ), and allowed set a new official price to buy and sell gold of $ 35. In addition, the Secretary of the Treasury was given control of all transactions in gold and the President was authorized to set the content of the dollar in gold between 50% and 60% in relation to its previous legal content.
Arguments
The content of the dollar fixed 31 of January of 1934 was 15,238 grains of gold standard 0.900 fine (equivalent to 13.714 grains of pure gold), representing 59, 06% of the previous content of 25.8 grains of gold standard (equivalent to 23.22 grains of pure gold).
A troy ounce equals 480 grains, The new price of $ 35 is obtained by dividing 480 by 13,714 and the previous price of $ 20, 67, dividing 480 by 23, 221 or (one grain equals 0.0648 grams).
Considering that President Roosevelt had issued the 5 of April of 1933 an executive order which holding gold was prohibited in coins, bullion and certificates by individuals and private entities and mandatory sale was available to the (Central Bank) Federal Reserve to the official price of 20.67 an ounce, and that this was the level at which their gold holdings were valued, this revaluation of gold represented for the government of the United States a gain of about $ 3 billion (equivalent to a current value of about $ 49 billion). Two-thirds of this figure was placed in a fund to buy and sell foreign exchange as necessary to help stabilize the dollar exchange rate.
Results
As a counterpart to these government profits, everything that had been forced to sell gold to the State at the previous price, or those who owned cash or held dollar deposits, had their overnight gold value reduced to 59%. dollars received or deposits or cash they already had
