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In the 19th and early 20th centuries, gold played a key role in international financial transactions. The gold standard has been used to support currencies; The international value of the currency has been determined by its stable relationship with gold; Gold has been used to settle international accounts. The gold standard maintained fixed exchange rates, which were considered desirable, as they reduced the risk associated with trade with other countries. The Bretton Woods rules, set out in the articles of the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD), provide for a fixed exchange rate system. The rules also aimed to promote an open system by requiring members to convert their respective currencies into other currencies and to make free trade. Member States were only able to change their face value by more than 10% with the IMF agreement, depending on the IMF`s finding that its balance of payments was in “fundamental imbalance”. The formal definition of the fundamental imbalance has never been determined, which has created uncertainty in the authorities and has attempted to repeatedly devalue less than 10%. [26] Any country that has changed without authorization or in the event of a refusal has been denied access to the IMF. There was broad consensus among powerful nations that the lack of exchange rate coordination during the interwar period had exacerbated political tensions. This facilitated the decisions of the Bretton Woods conference. In addition, all the Bretton Woods governments agreed that the monetary chaos of the interwar period had brought some valuable lessons. 730 delegates from the 44 Allied nations gathered at the Mount Washington Hotel in Bretton Woods, New Hampshire, USA, for the United Nations Monetary and Financial Conference, also known as the Bretton Woods Conference. Delegates deliberated from July 1 to 22, 1944 and signed the Bretton Woods Agreement on the last day.

Through the establishment of a system of rules, institutions and procedures for regulating the international monetary system, these agreements created the IMF and the International Bank for Reconstruction and Development (IBRD), now part of the World Bank Group. The United States, which controlled two-thirds of the world`s gold, insisted that the Bretton Woods system was based on both gold and the U.S. dollar. Soviet representatives attended the conference, but then refused to ratify the final agreements and claimed that the institutions they had created were “branches of Wall Street.” [1] These organizations were commissioned in 1945 after the agreement was ratified by a sufficient number of countries.

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