Fantasies, failings, fraud, and folderol. These are the elusive straws we grasp for when contemplating the marvels of modern day money. There’s little hope we’ll ever come up with a solid handful we can pull ourselves up by.
Still, we continue to mull things over like a freshman math major mulling over Fermat’s Last Theorem. With a little luck we may eventually have a breakthrough. Where to begin?
President Nixon’s dirty deed in 1971 is as good an entry point into the review as any. Recall that seizing the unique opportunity of the breakdown of Bretton Woods, Tricky Dick severed the last vestiges of gold backed money and stiffed the world unconditionally.
No longer could foreign governments redeem the dollars they acquired through trade for gold. The world’s currencies became wholly the fiat – paper money – of governments. Since then currencies have floated like anchorless buoys, rising and falling on a sea of surging currents.
Without restraint the darnedest things were made possible. Continue reading
