This was written 25 years ago, about events 50 years ago and forward, by Nobel Laureate Robert A Mundel:
"The rules of the game of the (monetary) system constitute a combination of laws, commitments, conventions and gentlemen's agreements by which the inner country (the United States) pegs its currency (the dollar) to gold and the outer countries (Let us call them Europe) peg their currencies to the dollar, either directly or indirectly through another currency (such as the pound sterling or the franc). This means that the United States acts as the residual buyer or seller of gold, whereas Europe acts as the residual buyer or seller of dollars."
It sure lays some nice ground work for what is happening now....
Thursday, August 25, 2011
How the Monetary System Works
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