It wasn’t a “secret.” The terms of the post WWII Bretton Woods Agreement meant the US Treasury openly gave it to them.
The terms of the post WWII Bretton Woods Agreement meant the US Treasury openly gave it to them.
President Trump had better get busy making good on his Gold audit, he is running out of time.
“It wasn’t a “secret.” The terms of the post WWII Bretton Woods Agreement meant the US Treasury openly gave it to them.”
Exactly. There was nothing secret about France redeeming their dollar holdings for gold.
We had a low level inflation that had begun during the Eisenhower years. And the French knew it.
The inflation was a consequence of “the Triffin Dilemma” which resulted from the dollar’s role as world reserve currency under the Bretton Woods system.
https://www.dunham.com/FA/Blog/Posts/triffins-dilemma?
We ended up with more dollars being held as reserves by foreign central banks than we could back with our gold stock.
France didn’t intend to be the suckers in this so all during the 1960s they would turn in their dollar holdings for gold at the “official” exchange rate of $35. There was a simultaneous private sector gold market which reflected actual values and gold traded for something like $40.
Nixon decided to put an end to this by “suspending” Bretton Woods. Which led to the even greater inflation of the 1970s.
And while ending Bretton Woods saves what is left of our gold reserves it doesn’t end the Triffin Dilemma problem as long as the dollar remains the world’s reserve currency.