4 ms·

> The US had paid for its imports with pieces of paper on the promise, that these pieces of paper were as good as gold and would be exchanged for gold at a fixe

by krona 10y ago

> The US had paid for its imports with pieces of paper on the promise, that these pieces of paper were as good as gold and would be exchanged for gold at a fixed rate upon request. In 1971 Nixon just said screw you, you can keep those papers and we will keep your commodities and the gold. We stayed friends anyway. We had to. It's a bit more complicated, isn't it? Wasn't it West Germany, in May 1971, that said "screw you" to the US and the Bretton Woods system (the same system that helped them rebuild their economy after the war) and performed a competitive appreciation by floating the currency, contributing to the resulting Gold crisis? The Nixon shock happened in August 1971, when the game was up.

dualogy 10y ago
This Germany may have done, but "the gold crisis" / general Bretton-Woods-Exchange-Mechanism crisis brewed since the mid-late 60s and culminated visibly in France (de Gaulle I think) sending a tanker to collect their $ trade surpluses in physical bullion form, see the ending of the https://en.wikipedia.org/wiki/London_Gold_Pool https://en.wikipedia.org/wiki/London_Gold_Pool --- all Nixon did in Aug 1971 was basically just confirming to the world the completion of a transition that had been in progress for years, at that point. It all started with the emergence of "Eurodollars" in the City of London, in the late 50s --- in itself, and their consequences, an inevitably that only a few thinkers such as https://en.wikipedia.org/wiki/Jacques_Rueff https://en.wikipedia.org/wiki/Jacques_Rueff foresaw with any kind of accuracy (even though his favouring a gold standard isn't something I personally buy into as a good idea for the modern globalized economy --- same goes for a dollar standard or Euro standard or crypto-standard or any such notion though)

4 ms·

> The US had paid for its imports with pieces of paper on the promise, that these pieces of paper were as good as gold and would be exchanged for gold at a fixe

by krona 10y ago

dualogy 10y ago
This Germany may have done, but "the gold crisis" / general Bretton-Woods-Exchange-Mechanism crisis brewed since the mid-late 60s and culminated visibly in France (de Gaulle I think) sending a tanker to collect their $ trade surpluses in physical bullion form, see the ending of the https://en.wikipedia.org/wiki/London_Gold_Pool https://en.wikipedia.org/wiki/London_Gold_Pool --- all Nixon did in Aug 1971 was basically just confirming to the world the completion of a transition that had been in progress for years, at that point. It all started with the emergence of "Eurodollars" in the City of London, in the late 50s --- in itself, and their consequences, an inevitably that only a few thinkers such as https://en.wikipedia.org/wiki/Jacques_Rueff https://en.wikipedia.org/wiki/Jacques_Rueff foresaw with any kind of accuracy (even though his favouring a gold standard isn't something I personally buy into as a good idea for the modern globalized economy --- same goes for a dollar standard or Euro standard or crypto-standard or any such notion though)