Gold: A Welcome Calm

The two-tier system of gold prices last week withstood the first important test of its ability to survive.

London's gold market, hitherto responsible for 80% of the world's gold trading, reopened after a two-week shutdown aimed at stifling the gold-buying stampede that threatened the dollar. Now the question was whether the free-market price of the metal, no longer supported by the disbanded seven-nation gold pool, would climb so far above its $35-per-oz. official monetary level as to rekindle speculative frenzies.

Though some Europeans had predicted that the price might double on the free market, nothing of the kind occurred. Trading...