GRABOW_GEOFFREY@tandem.com asked:
Didn't Nixon take the U.S. off of the gold standard?
Sort of. The market made him do it. Any real bankers out there can answer this better than I can. The way I remember it, the Bretton Woods agreement made the "dollar as good as gold", which was intended to stabilize the postwar economy and back up the Marshall plan, I think. In the late '60s and early '70s, the european economy was good enough that people (Charles DeGaulle's government in France, among them) started to call the US Treasury's bluff, and cash in dollars for gold. I believe Nixon made two changes. First, he decoupled the dollar from the price of gold, thus making the dollar more explicitly a part of the floating exchange rate mechanism (or more so, anyway). Second, he started making it legal for americans to own gold again, something FDR outlawed during the depression. Moving it more towards crypto here. . . IMO, someday there *will* be a strictly digital, anonymous, liquid medium of exchange, a currency, simply because computer transmissions are just another means to transmit promises, like metal and paper. However, the next real step in that direction is to develop "securities" like money market instruments, which are denominated in an existing currency, but are "traded" not by institutions, but by people and/or business on the internet, in order to meet very real needs, like selling software, information, entertainment, etc. I guess that's why I subscribed to this list, and why I'm somewhere in the middle of the stream cypher section of Schneier's book. :-). Bob ----------------- Robert Hettinga "There is no difference between someone Shipwright Development Corporation eats too little and sees Heaven and 44 Farquhar Street someone who drinks too much and sees Boston, MA 02313 USA snakes." -- Bertrand Russell (617) 323-7923