Fortieth Anniversary of Default

Matthew

Matthew

True Classic
Forty years ago today the US government officially defaulted. Or as Nixon put it "defend the dollar" from speculators:rolleyes:

[ame="http://www.youtube.com/watch?v=kqZJ3D9T8Ew&feature=player_detailpage"]Nixon Ends Bretton Woods International Monetary System - YouTube[/ame]
 
Default is kind of a strong word;....

it was more like a unilateral renegotiation of the contract terms:whistle:
Jut what you would expect from Nixon, no?
 
If for years you promise to pay 1/35th of an ounce of gold for every dollar and then one day you tell everyone that they get nothing (or very little) I don't know how that can be considered anything but text book default.
 
Well, it depends on what...

textbook you are reading I suppose. They still got what ever purchasing power the papaer money had. The Swiss just did the same thing by devaluing the Franc (in fact they all but abandonded gold in '71 too) the Argentinians did it in devaluing their currency just a few years ago. That's how it works-countries do what is best for them, all things considered. If taking a little heat over making funny money acheives the goal then so be it. The gold standard is the hobby horse of some not all.
 
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