According to the wishes of Americans, the Bretton Woods system is to establish the hegemonic position of the US dollar. But in fact, after more than 20 years of practice, from 1944 to 197 1 year, for 27 years, it did not really give Americans hegemony. What stopped the hegemony of the dollar? It is gold.
At the beginning of the establishment of the Bretton Woods system, in order to establish the hegemonic position of the dollar, Americans made a commitment to the whole world, that is, to lock the currencies of various countries in the dollar, while the dollar locked in gold. How to lock it? 1 ounce of gold at $35. With this promise of the dollar to the whole world, Americans can't do whatever they want. Simply put, 35 dollars for 1 ounce of gold means that Americans can't print dollars indiscriminately. If you print an extra $35, you must keep 1 ounce of gold in the vault.
The reason why the United States was confident to make such a commitment to the world was because it held about 80% of the world's gold reserves at that time. Americans think that I have so much gold in my hand that it is no problem to support the credit of the dollar. But the situation is not as simple as Americans think. After World War II, the United States was involved in the Korean War and the Vietnam War. These two wars caused heavy losses to the United States, especially the Vietnam War. During the Vietnam War, the United States destroyed nearly $800 billion in military expenditure. With the increasing cost of war, the United States is a little impatient. Because according to America's promise, every loss of $35 means a loss of 1 ounce of gold.
By August, 197 1, Americans still have more than 8,800 tons of gold. At this time, Americans know that they are in trouble, and at the same time, some people are still creating new troubles for Americans. For example, French President Charles de Gaulle, who doesn't believe in dollars, asked the French finance minister and the governor of the central bank to see how many dollars France had, and the answer was about $2.2-2.3 billion. De Gaulle said that no money was left to the Americans, and it was replaced by gold. The French attack on Americans has had a demonstration effect on other countries. Other countries with foreign exchange surpluses told Americans that we don't want dollars, we want gold. This has forced Americans to go nowhere.
Thus, on August 197 1 day, then US President Nixon announced the closing of the golden window, and the dollar was decoupled from gold. This is the beginning of the collapse of the Bretton Woods system, and it is also the betrayal of Americans to the world. But for the whole world, people at that time did not fully understand the clues. It turns out that we believe in dollars because there is gold behind them. It has been more than 20 years since the US dollar became the international currency, settlement currency and reserve currency, and people have become accustomed to using the US dollar.
Now the dollar brakes suddenly, and there is no gold behind it. Theoretically, it has become a pure green book. Do we still need it at this time? Not necessarily, but what is used to measure the value of goods in international settlement? Because money is a measure of value, if you don't use dollars, can you trust other currencies? For example, between RMB and ruble, if Russians (then Soviets) don't recognize RMB and we don't recognize ruble, then we can only continue to use USD as the medium of exchange between us.
Therefore, Americans used the inertia and helplessness of the world to force the Organization of Petroleum Exporting Countries (OPEC) to accept the American condition in June 1973: global oil transactions must be settled in US dollars. Before that, global oil transactions could be settled in various international currencies, but after 1973 10, everything changed. The Organization of Petroleum Exporting Countries announced that global oil transactions must be settled in US dollars.
In this way, Americans decouple the dollar from gold and precious metals, and then link it with commodity oil. Why? Because Americans see it clearly, you may not like dollars, but you may not like energy. You can do without dollars, but can you do without oil? Any country needs energy to develop, and all countries need oil. In this case, if you need oil, you need dollars, which is a very clever move by Americans. Since the dollar was pegged to oil at 1973, it was actually decoupled from gold at 197 1, and the dollar and the United States began a new course.
At that time, few people in the world clearly saw this, including many economists and financial experts. They can't point out very clearly that the most important events in the 20th century are World War I and World War II, not the Soviet Union's solution. The most important event in the 20th century was the decoupling of $ KLOC-0/9715 from gold in August.
Since then, mankind has really seen the emergence of a financial empire, which has brought all mankind into its financial system. In fact, the so-called dollar hegemony was established from this moment. It has been about 40 years since today. After this day, we entered a real era of paper money. There is no precious metal behind the dollar, which is completely supported by government credit and benefits the whole world. To put it simply: Americans can get physical wealth from all over the world as long as they print a green paper. There has never been such a thing in human history. There are many ways to acquire wealth in human history, either with money or with gold or silver; Either plunder by war, but the price of war is very huge. And when the dollar becomes a green book, the cost of making a profit in the United States can be said to be extremely low.
Because the dollar is decoupled from gold, gold no longer drags the dollar back, and the United States can print dollars at will. At this time, if a large number of dollars stay in the United States, it will cause inflation in the United States; If we export dollars, it means that the whole world will digest inflation for the United States, which is the main reason why the inflation rate of dollars is not high. In other words, the United States exports dollars to the world, diluting its inflation. But after the dollar was exported to the world, Americans had no money. At this time, if Americans continue to print money, the dollar will continue to depreciate, which is unfavorable to the United States. Therefore, the Federal Reserve is not a central bank that prints money indiscriminately, as some people think. The Fed actually knows what restraint means. From the establishment of the Federal Reserve in 19 13 to 20 13 100, how many dollars did the Federal Reserve issue? About 10 trillion.
With this contrast, some people began to blame the Bank of China. Why? Our central bank has issued new currency and new RMB since 1954, and now it has issued more than 120 trillion RMB. If converted into dollars at the exchange rate of 6.2, we have issued about 20 trillion dollars. But this does not mean that China is printing money indiscriminately, because China has made a lot of dollars since the reform and opening up, and at the same time, a lot of dollars have entered China as overseas investment.
However, due to foreign exchange control, the US dollar cannot circulate in China, so the central bank must issue RMB corresponding to the US dollar and other foreign currencies entering China, and then circulate in China in RMB. However, after making money in China, foreign capital may withdraw; At the same time, we will spend a lot of foreign exchange to buy resources, energy, products and technology from abroad. As a result, a large number of dollars left and the RMB stayed. You can't destroy the corresponding amount of RMB, you can only keep RMB in circulation at home. Therefore, the stock of RMB in China must be greater than the US dollar. This, in turn, proves the amazing economic development of China in the past 30 years. The Bank of China admitted that it has issued more than 20 trillion RMB in recent years. A huge amount of excess money ended up in China, which involves the question I will talk about later-why the RMB should be internationalized.