Wikipedia talk:Mediation Cabal/Cases/2006-05-27 Gold as a measure of inflation

Initial compromise version of the disputed section

Gold and silver have been used as money since the invention of money, and these precious metals are considered by some to be a benchmark of inflation. Over the past 150 years the supply of gold has tended to grow at an annual rate of about 2% as new supplies are mined and refined, encouarging governments throughout history to turn to the creation of fiat currency. While the rate of inflation of the gold supply is limited by the effort required to find feasable deposits, the labour required to mine the deposits that are found and the energy required to refine the mined ore in to gold, nothing effectively stops governments from printing fiat currency. Gold and silver, in one form or another, were used as money from at least 600 BC to the end of the Bretton Woods system in 1971. After 1971 transactions between countries became independent of gold, and it became debatable whether gold could be considered as much of a benchmark as previously; nonetheless, gold and silver coins are still minted all over the world, and some websites allow traders to use gold to pay for goods and services.

At the Bretton Woods Conference, the Bretton Woods system solidified the gold standard by requiring the signatories to adopt an exchange rate for their currency. This system remained in place until Richard Nixon "closed the gold window" after France began to demand the gold represented by the U.S. dollars held by the central bank of France. This run on the U.S. gold deposits happened because there were more dollars in circulation than was backed by gold. Today, the U.S. Treasury values its gold at 42.2222 per troy ounce as stipulated by the Bretton Woods agreement.