Wednesday, September 28

Nixon Shock, Inflation, and Bitcoin: What’s the Problem with the Economy? By CoinTelegraph

© Reuters. Nixon Shock, Inflation, and Bitcoin: What’s the Problem with the Economy?

For many conservatives, it was a grave mistake to break with the Bretton Woods Accords. Apparently, everything was much better with the boss. Richard Nixon, of course, the great culprit of everything. We have the inflationary crisis of the 1970s as a result. The conservative view tells us: “Inflation is always a monetary phenomenon.” Putting the dots together, we get a very popular narrative in some right-wing circles. In fact, one could say that cryptocurrencies are born from a conservative / libertarian reading of the 2008 credit crisis. Is fiat money the source of all our ills?

Why did Nixon break with the Bretton Woods Accords? If we ask the most critical, their motivation was greed. In other words, in this way the Government could spend without measure. We must remember that it was the time of the Vietnam War. So the first answer is statism. In short, the Bretton Woods Accords set the international price of currencies to the dollar. And the dollar was pegged to gold at a fixed rate. In this case, the dollar was a representative currency. It represented ounces of gold deposited at Fort Knox. That obviously limited the power of the Government in economic matters.

Read on: “Will Replace the Dollar”: Possibility or Delusion?

Read the full article on Cointelegraph

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