M u s e u m  C r e a t e d  L e s s o n

Gold in Culture

ArtGalNS

Art Gallery of Nova Scotia, Halifax, Nova Scotia

Gold Coins and Gold Standard

O Gold! I still prefer thee unto paper,                                      
Which makes bank credit like a bark of vapour.

    George Gordon Lord Byron, 1819, English poet

Coins and Bars
Gold has been used as a medium of exchange within and between nations for at least 8000 years. It has been made into a variety of coins:  there was the daric, named after Darius the Great in Persia  (521-486 BCE), Augustus of Rome issued the aureus (31 BCE-CE 14), Constantine the Great (CE 306-377) replaced that with the solidus. In Canada today, gold Maple Leaf bullion coins are minted. They are said to be the world’s most popular pure gold coin because of their standard of purity, 9999 fine.

The Canadian Mint also produces gold kilo bars, trade bars, and gold wafers. Different countries produce their own specific bars and bullions. Brazil makes finger-shaped ingots; Hong Kong and Taiwan produce the boat-shaped tael bar. In the United States, the gold left in a crucible when a regular-sized gold bar is cast is shaped into a small ingot nicknamed a “Hershey Bar.”

Gold Standard
Gold has been used as a measure of value for centuries. In early Babylon, currencies were based on grain, but gold was used to represent the grain’s stored value. That same idea of an agreed upon standard made it possible for paper money to take the place of trading heavy gold bullion or coins. The value of the currency unit—for instance, dollar—was defined in relation to the value of gold.

At different times in different countries, a gold standard was established, guaranteeing that paper money could be redeemed for its value in gold. This history had many permutations over the centuries. Some countries had a silver standard, some a combined standard. The purpose was to stabilize the global economy, by requiring that only as much currency could be issued as there was gold in reserve.

The gold standard was legislated in Great Britain in 1844 and by the United States in 1900. The Canadian dollar was defined as 15/73 of the British sovereign in 1858. In 1910, the Canadian dollar became the exact gold equivalent of the U.S. dollar.  During World War I, many countries suspended the gold standard in order to print more paper money—connected to no standard—to pay for military expenses. In 1929, Canada ended its adherence to the gold standard. In 1971, it was President Nixon who called an end to trading gold at a fixed price, the practice that had replaced the gold standard in 1946.

Through all these changes, gold continued to increase in value. Many buyers think it is the best form of security, particularly in times of economic uncertainty. This belief, and recent financial unrest, has caused record high prices for gold. In 2010 there were thirty-five successive highs recorded by the London afternoon fix; there are two fixes a day which record the world price of gold.
  
Art Gallery of Nova Scotia, Dian Day, Susan Sellers, Rita Wilson


© 2013, Art Gallery of Nova Scotia. All Rights Reserved.
Learning Object Collection: Gold in Nova Scotia
Learning Object: Golden Culture—A Rich and Complex Story
Institution: Art Gallery of Nova Scotia