There was a chance in 1971 that the world’s monetary system could have been regularized and that the 2008 Crash would never have happened. Instead, America continued to print dollars and spend them like a man with no arms. It also meant that inflation was institutionalized as never before. Massve debts accumulated and completely outweighed the loan side of the world’s balance sheet. That’s where we are now.
After the Bretton Woods Agreement in 1942, the American dollar was placed in a privileged position so that gold — most of it already in America’s possession — could only be bought by dollars. By the late 1960s, however, some European countries had recovered sufficiently from the Second World War to have earned some dollars from trade and were queuing up at the New York Federal Bank’s gold window.
Within a few years, America’s gold reserves hurtled down from 21,000 tonnes to 11.000 tonnes and would have disappeared completely within another year or two had not President Nixon decided to take the American dollar off the gold standard completely. This meant that the American dollar could keep on inflating and America could continue to do what it was doing militarily over the world.
If, on the other hand, he had kept the dollar on the gold standard but allowed gold to find it own free market price without manipulating it, then the world’s balance sheet would be somewhere around zero, as it ought to be. Debts are paid promptly and bankruptcies, even of banks, are encouraged, in eras of no inflation. Certainly the 2008 Crash would never have happened.