It has been nearly 40 years since Richard Nixon ended the direct convertibility of the U.S. dollar to gold, putting an end to the international gold-dollar standard established by the Bretton Woods Agreements following World War II. In the pinch of the current financial crisis, are we now left susceptible to the powerful moral hazards that this quasi gold standard was designed to prevent?
A gold standard is a monetary system in which the standard economic unit is a fixed weight of gold.
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