Gold lost its central role in the world monetary system on 15 August 1971, when US President Richard Nixon announced the ending of the gold exchange system: America would settle its deficits in dollars, not in bullion. Half a century later, gold has crept back as a major force in world money. One important reason is quantitative easing. Central banks acquired large volumes of government bonds as a device to pour liquidity into markets shattered by catastrophic falls. But now that inflation has re-emerged much more strongly than anticipated, the bonds themselves have fallen significantly in value. This has exposed ... (full story)