Monday, January 19, 2015

PMG - The Collapse of the Bretton Woods Fixed Exchange Rate System

"The collapse of the Bretton Woods system of fixed exchange rates was one of the most accurately and generally predicted of major economic events.’ Hind- sight, of course,  sharpens  the  perception of the  inevitability of events  and makes great prophets of those members of the spectrum of analysts who hap- pened to get their predictions right. But the general outlines at least of the key events from 1967 through 1971 were foreseen, starting from the work of Triffin (1960), whose warnings provided  the compass  to policymakers  implementing serious changes in the provision of liquidity  and the administration of capital controls in a vain attempt to preserve the system..."

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