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Thread: Will the currency war break out?

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[quote=KEVIN0518,266596]Quote: "so it seems that U$ system still hard although US gov. gets its currency depreciated to balace its fiscal deficits. and U$ still pegged to GOLD BULLION SYSTEM, gold value sores with the devaluation of U$, so I am confused by saying that destroying gold system... "

After the Bretton Woods System was established, all currencies were then linked to the dollar by exchange rates fixed at some par value. And the dollar was linked to gold. Personally, I think that there are some differences between gold standard system and Bretton Woods System. In Bretton Woods system, dollar plays the important role, not the gold. What’s more, during 60s to 70s in 20t century, dollar had depreciated very much. Even the US Fed refused to pay gold to those foreign nations. This means that the Bretton Woods system collapsed. In 1970s, a new exchange rate system was introduced, that is, floating exchange rate system. Under this system, dollar’s role in international trade had been reduced. Euro’s popularization is a good example to illustrate this. 
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