Post by Steve Gardner on May 6, 2008 21:52:56 GMT
...Monetary System
Although not technically about Petrodollar Warfare, this video captures the moment US President Richard Nixon announced that the US was abandoning the Gold Standard, established under the Bretton Woods Agreement (see this article for more). He blamed currency speculators and, of course, neglected to mention the costs of the Vietnam War, soaring inflation and an out-of-control debt burden.
Fortunately, within a year or so, Henry Kissinger was able to persuade the Saudis to price their oil exclusively in $US, thus establishing the Petrodollar and a neat (from a US perspective) system known as Petrodollar Recycling, whereby the US effectively obtained its oil for just a few Cents in the Dollar.
Although not technically about Petrodollar Warfare, this video captures the moment US President Richard Nixon announced that the US was abandoning the Gold Standard, established under the Bretton Woods Agreement (see this article for more). He blamed currency speculators and, of course, neglected to mention the costs of the Vietnam War, soaring inflation and an out-of-control debt burden.
Fortunately, within a year or so, Henry Kissinger was able to persuade the Saudis to price their oil exclusively in $US, thus establishing the Petrodollar and a neat (from a US perspective) system known as Petrodollar Recycling, whereby the US effectively obtained its oil for just a few Cents in the Dollar.
Nixon Ends Bretton Woods International Monetary System
August 8th, 2007
4 mins 5 secs
Nixon Ends Bretton Woods International Monetary System
Description from Google Video
On August 15, 1971, President Nixon announced on TV 3 dramatic changes in economic policy. He imposed a wage-price freeze. He ended the Bretton Woods international monetary system. And he imposed a temporary surcharge (tariff) on all imports. The Bretton Woods system was created towards the end of World War II and involved fixed exchange rates with the U.S. dollar as the key currency - but also a role for gold linked to the dollar at $35/ounce. The system began to falter in the 1960s because of an excess of dollars flowing out of the U.S. which foreign central banks had to absorb. A run on gold in 1968 was stemmed by a patch on Bretton Woods known as the two-tier gold system. All of this was ended unilaterally by the Nixon decision. After a brief attempt to create a modified fixed exchange rate system, the world moved to flexible rates.
