On Mon, 25 Apr 2011 17:12:19 -0400, the renowned "Ed Huntress"
wrote:


"Spehro Pefhany" wrote in message
.. .
On Mon, 25 Apr 2011 16:37:03 -0400, "Ed Huntress"
wrote:


"Spehro Pefhany" wrote in message
...
On Mon, 25 Apr 2011 13:22:57 -0400, "Ed Huntress"
wrote:

The thing that really ****ed us off was when they took a run at our gold
reserves in 1971. I still haven't forgiven them for that.

Have they forgiven the US for claiming that the dollars they held were
each worth 1/35 of an oz of gold? ;-)

They were, but they could have taken a damaging bite out of Fort Knox if
they cashed in.

What could be so damaging about exchanging one thing for something
else of equal value?

Spehro, if you want to get into this subject, either tell me what you really
know or find out for yourself. I'm sorry, but this is a long one, and I'm
short of time for getting into it.

My point is that the arrangement was already full of cracks and the
pillars were collapsing - the US was running huge deficits, in part to
finance the wars in Asia- with no political will to contain
expenditures.. and the dollar was no longer nearly as good as gold. In
fact, parallel private markets valued it quite a bit lower at the
time. The Frenchies (and Swiss etc.) were aiming to be first out the
door.. the gold standard has seldom survived a significant war.

The froggies were trying to pull a DeGaulle-type power play, trying to knock
the US out of its role of running the world's reserve currency. They were
still resentful about having lost their pre-eminence in the world and they
were pretty miserable about it. They had their own ideas about how the
Bretton Woods regime was supposed to work, and they didn't see themselves
filling a secondary role.

That may be, but we've almost come full circle.

You can take it from there.


Best regards,
Spehro Pefhany
--
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