Overview#
Bretton Woods Conference, formally known as the United Nations Monetary and Financial Conference, was the gathering of 730 delegates from all 44 Allied nations
at the Mount Washington Hotel|https://en.wikipedia.org/wiki/Mount_Washington_Hotel], situated in Bretton Woods, New Hampshire, United States, to regulate the international monetary and financial order after the conclusion of World War II.
The Bretton Woods Conference system required countries to guarantee convertibility of their currencies into United States Dollar to within 1% of fixed parity rates, with the United States Dollar convertible to gold bullion for foreign governments and Central Bank at $35US per troy ounce of fine gold (or 0.88867 gram fine gold per dollar).
Bretton Woods Conference also envisioned greater cooperation among countries in order to prevent future competitive devaluations, and thus established the International Monetary Fund (IMF) to monitor exchange rates and lend reserve currencies to nations with [balance of payments deficits.
Bretton Woods Conference set up a system of rules, institutions, and procedures to regulate the international monetary system, these accords established the IMF and the International Bank for Reconstruction and Development (IBRD), which today is part of the World Bank Group.
The United States, which controlled two-thirds of the world's gold, insisted that the Bretton Woods Conference rest on both gold and the United States Dollar.
Bretton Woods Conference was held from July 1 to the 22, 1944
United States termination of convertibility Dollar to Gold#
A negative balance of payments, growing public debt incurred by the Vietnam War and Great Society programs, and monetary inflation by the Federal Reserve caused the United States Dollar to become increasingly overvalued.
The drain on United States gold reserves culminated with the London Gold Pool collapse in March 1968. By 1970, the U.S. had seen its gold coverage deteriorate from 55% to 22%. This, in the view of neoclassical economists, represented the point where holders of the dollar had lost faith in the ability of the U.S. to cut budget and trade deficits.
In 1971 more and more dollars were being printed in Washington, then being pumped overseas, to pay for government expenditure on the military and social programs. In the first six months of 1971, assets for $22 billion fled the U.S.
On 15 August 1971, Nixon issued Executive Order 11615 pursuant to the Economic Stabilization Act of 1970 effectively bringing the Bretton Woods Conference to an end and rendering the United States Dollar a Fiat Currency.
More Information#
There might be more information for this subject on one of the following:- [#1] - Bretton_Woods_Conference - based on information obtained 2018-10-16