A gold certificate in general is a certificate of ownership that gold owners hold instead of storing the actual gold. It has both a historic meaning as a US paper currency (1863–1933) and a current meaning as a way to invest in gold.
Banks may issue gold certificates for gold which is allocated (non-fungible) or unallocated (fungible or pooled). Unallocated gold certificates are a form of fractional reserve banking and do not guarantee an equal exchange for metal in the event of a run on the issuing bank's gold on deposit. Allocated gold certificates should be correlated with specific numbered bars, although it is difficult to determine whether a bank is improperly allocating a single bar to more than one party.
Read more about Gold Certificate: Historic US Gold Certificates (1863-1933), Complete Series Catalogue
Famous quotes containing the words gold and/or certificate:
“The intelligent have a right over the ignorant, namely, the right of instructing them. The right punishment of one out of tune, is to make him play in tune; the fine which the good, refusing to govern, ought to pay, is, to be governed by a worse man; that his guards shall not handle gold and silver, but shall be instructed that there is gold and silver in their souls, which will make men willing to give them every thing which they need.”
—Ralph Waldo Emerson (1803–1882)
“God gave the righteous man a certificate entitling him to food and raiment, but the unrighteous man found a facsimile of the same in God’s coffers, and appropriated it, and obtained food and raiment like the former. It is one of the most extensive systems of counterfeiting that the world has seen.”
—Henry David Thoreau (1817–1862)