{"id":46510,"date":"2019-06-03T19:57:14","date_gmt":"2019-06-04T00:57:14","guid":{"rendered":"https:\/\/olduvai.ca\/?p=46510"},"modified":"2019-06-03T19:57:18","modified_gmt":"2019-06-04T00:57:18","slug":"from-gold-to-nothing-how-1971-changed-everything-in-the-economy","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=46510","title":{"rendered":"From Gold To Nothing: How 1971 Changed Everything In The Economy"},"content":{"rendered":"\n<h3 class=\"wp-block-heading\" id=\"efa3\"><a href=\"https:\/\/medium.com\/swlh\/from-gold-to-nothing-5bd86c0231be\">From Gold To Nothing: How 1971 Changed Everything In The\u00a0Economy<\/a><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">The monetary system is a major component of the whole economic system. Despite that, today we&nbsp;<strong>take it for granted<\/strong>&nbsp;and don\u2019t even ask ourselves how it works and if it is the best solution available or the correct way to manage things.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Even though it appears to be stable, history shows that&nbsp;<strong>monetary systems changed periodically<\/strong>&nbsp;in the last century (20\u201330 years on average).<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The main difference between our current monetary system and previous monetary system is that&nbsp;<strong>today it is entirely based on&nbsp;<\/strong><a href=\"https:\/\/www.investopedia.com\/terms\/f\/fiatmoney.asp\" rel=\"noreferrer noopener\" target=\"_blank\"><strong>FIAT Currency<\/strong><\/a>, in contrast to older monetary systems that were&nbsp;<strong>backed by gold<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">That means that what we call money is a government-issued currency that has&nbsp;<strong>zero intrinsic value<\/strong>&nbsp;and is not backed by anything.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">From 1971, this kind of system&nbsp;<strong>allows central banks to literally control the economy<\/strong>&nbsp;and opened a new chapter in the world monetary system.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In this article, I am going to briefly explain why&nbsp;<strong>1971 changed everything<\/strong>and what are potential consequences of such a decision.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p>Since 1971 the world runs on FIAT currencies that are not gold-backed in any way. This changes everything.<\/p><\/blockquote>\n\n\n\n<p class=\"wp-block-paragraph\">Before digging into it, we have to review some history.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>The Bretton Woods System and It\u2019s\u00a0Collapse<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Towards the end of the World War II, peace was a real concern and it was clear that&nbsp;<strong>the world needed a new monetary system<\/strong>&nbsp;able to support the economy.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In fact, one of the major reason that led to World War II was the failure in dealing with economic problems after World War I.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Why It Was Needed And How It\u00a0Worked<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Bretton Woods agreement was signed at a conference between allied nations in 1944.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">&nbsp;\u2026click on the above link to read the rest of the article\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"<p>From Gold To Nothing: How 1971 Changed Everything In The\u00a0Economy The monetary system is a major component of the whole economic system. Despite that, today we&nbsp;take it for granted&nbsp;and don\u2019t even ask ourselves how it works and if it is the best solution available or the correct way to manage things. Even though it appears [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[5988,124,374,536],"class_list":["post-46510","post","type-post","status-publish","format-standard","hentry","category-economics","tag-5988","tag-central-banks","tag-gold","tag-money"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/46510","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=46510"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/46510\/revisions"}],"predecessor-version":[{"id":46511,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/46510\/revisions\/46511"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=46510"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=46510"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=46510"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}