Talk:Nixon shock

message: I am of the understanding that a balance of payments always sums to 0, and that the sentence should thus be changed to read current account deficit. I'm no economist though, so seeking a second opinion.  Smazza (talk) 14:30, 2 January 2012 (UTC)
thread_title: Balance of payments deficit?

message: The article mentions "The return to a gold standard is supported by many followers of the Austrian School, Objectivists, libertarians,[7] largely because they object to the role of the elected government in issuing fiat currency through central banks." 
The source does not provide the kind of evidence that would justify mentioning "many followers" of the very broad schools of Objectivism (an ethical philosophy with economic implications that are not at all necessarily supportive of the gold standard) and Libertarianism (a political philosophy based on personal freedoms and a free market economic system of capitalism, not gold standards). 
If an adequate citation can be presented that suggests a sizable portion of either of these schools (in an international sense, not only reflecting the nature of specifically American adherents) advocates the gold standard and that it is relevant to the central concepts of their philosophies, then I think they should be added in. Until then I think it's best the article not list them. 
--96.231.134.137 (talk) 12:20, 2 September 2011 (UTC)
replies: text: Currently it's illegal to use gold to pay for something in the United States. Ron Paul merely wants to treat gold as money (as it has been for thousands of years) and make gold legal tender as a legitimate competitor to the dollar. He favors a currency backed by something, but has never really pushed the issue of a gold standard because he knows it can't happen in the current economic climate. Peter Schiff was Ron Paul's economic adviser in 2008, having warned about the economic collapse, and both men share a similar record for getting it right even when the idiots that criticize them repeatedly turn out to be horribly wrong. Libertarian economic policy is largely based on the idea of 'sound money', which need not be tied to gold, but should at least be tied to something of intrinsic value (could also be silver and other precious metals). I think a lot of progressives and conservatives alike have misunderstood Ron Paul's economic beliefs; he doesn't actually use term 'gold standard' very often (certainly not as much as he mentions 'sound money'). Have a read of http://en.wikipedia.org/wiki/Political_positions_of_Ron_Paul#Inflation_and_the_Federal_Reserve --203.129.23.146 (talk) 08:16, 7 April 2013 (UTC)
thread_title: Schools of thought supporting the gold standard

message: Does anyone know how this effected the economy at the time? Chuy1530 (talk) 18:09, 24 June 2008 (UTC)
thread_title: effected the economy

message: The opening paragraph end by saying that the phrase "Nixon Shock" is also used to describe Nixon's visit to China (in addition to the economic policy). This isn't mentioned at all in the rest of the article, and Google is none the wiser. I'm sure it was a shock; but was it the Nixon Shock? -Ashley Pomeroy (talk) 11:49, 8 October 2008 (UTC)
thread_title: Buxib in Chuno

message: "By the early 1970s, as the Vietnam War accelerated inflation", war doesn't cause inflation. Printing more money causes the existing money to inflate, lowering the value of all the currency. This statement doesn't seem correct. Packetdrop (talk) 00:38, 12 November 2008 (UTC)
replies: text: Inflation is the act of increasing the supply of money and/or credit.  Inflating the money does not "inject capital", it dilutes capital, by transferring purchasing power from anyone already holding the currency to those who receive the newly-created cash or credit.24.6.159.76 (talk) 16:55, 4 August 2009 (UTC)
replies: text: Although that's sometimes the colloquial understanding, inflation is supposed to refer to an increase in price levels. Which can happen with or without monetary expansion. There have actually been periods of deflation while the money supply has been expanding before, and vice versa. This is actually the cause of most hyperinflation - they weren't actually increasing the Zimbabwean money supply by thousands of percentage points ever day; that would be impossible. People began to view the currency as increasingly worthless, and would only accept a ridiculous amount of it in exchange for anything. Although the inflation was set off by printing money, once it had started it continued on its own, and little could stop it.98.95.154.85 (talk) 18:44, 16 June 2011 (UTC)
replies: text: No, inflation is the increase in the money supply.  Rising prices are the effect of inflation, they are not inflation itself.  By pretending that inflation is a price phenomenon and not a manipulatin of the money supply, the central banks deflect public anger from the banks who are inflating the money, to the merchants who raise their prices to cope with the devaluation of the money. This misunderstanding has allowed governments to pretend that inflation is some kind of mysterious phenomenon over which they have no control, when in fact it is, and has always been a policy.  — Preceding unsigned comment added by 76.103.102.240 (talk) 14:59, 26 July 2012 (UTC)
thread_title: Wars don't cause inflation

message: Why is Shock capitalized? Where did the name "Nixon Shock" come from? Mike R (talk) 18:54, 31 October 2009 (UTC)
replies: text: It's mentioned in The monetary policy of the Federal Reserve: a history  by Hetzel. As far as I can tell from the visible excerpt, it is the (translated) Japanese name for Nixon's August 15, 1971, speech.   Will Beback  talk   20:45, 31 October 2009 (UTC)

text: 'Shock' because the rest of the world was shocked at the unilateral decision that condemned relatively strong nations to decades of structural reforms and more fragile ones to outright economic slavery.  — Preceding unsigned comment added by 79.13.219.18 (talk) 18:01, 1 September 2014 (UTC)
thread_title:  Why is Shock capitalized? Where did the name "Nixon Shock" come from? 

message: This whole article is based on pseudo economics such as the Austrian School. Wikipedia is an encyclopedia and we cannot use pseudo sciences and studies to back up arguments. The Austrian School does not us mathematical tools of analysis, does not believe in many of the core precepts of economics and is based on broad assumptions. It is therefore akin to a belief. I suggest that we delete large part of this page and stick to the historical narrative. Leave the economics to the Economic History of the United States or the Economic History of the 20th Century.  —Preceding unsigned comment added by 65.24.133.184 (talk) 23:03, 20 February 2010 (UTC)
replies: text: Every single reference in the background section is from one David Frum book.  He sounds like a neocon propagandist.  Is this an article on "Nixon Shock", or a summary on a David Frum book?98.165.15.98 (talk) 01:59, 15 May 2010 (UTC)
thread_title: Based on Pseudo Economics

message: In May 1971, inflation-wary West Germany was the first member country to leave the Bretton Woods system — unwilling to deflate the Deutsche Mark to prop up the dollar.[1]  In order to prevent the dumping of the Deutsche Mark on the open market, West Germany did not consult with the international monetary community before making the change. In the next three months, West Germany’s move strengthened their economy; simultaneously, the dollar dropped 7.5% against the Deutsche Mark.[1]
I am not an expert, but there seems to be some contradiction (or unclarity?) in these two sentences. Was Germany afraid of deflation (of the Deutschmark) or inflation? Did leaving Bretton Woods result in deflation or inflation?
Perhaps someone who understands this could either clarify in the article or just leave a message here pointing out to me why this is correct as written (if you would be so kind)?  —Preceding unsigned comment added by 82.12.240.77 (talk) 10:04, 31 October 2010 (UTC)
thread_title:  West Gemany 

message: The article claims that "In 1971, the U.S. government again printed more dollars (a 10% increase)[1] and then sent them overseas, to pay for the nation's military spending and private investments." To my knowledge, the federal reserve is prohibited from printing money and sending it directly the treasury, and almost all money that's printed is simply loaned out via banks (the current quantitative easing being an exception). It's directly sourced to the David Frum book that almost everything in the article seems to point towards, but I ctr-f'd the book and searched for "print" and "printed", and nothing validating this claim came up. Does anyone have any more valid sources for this? If not, I'm going to delete it.98.95.154.85 (talk) 18:51, 16 June 2011 (UTC)
thread_title: Printing money to directly finance the war

message: Why is only this viewpoint presented? Why aren't other competing analyses presented?  — Preceding unsigned comment added by 64.223.88.93 (talk) 03:37, 29 May 2012 (UTC)
replies: text: Well, that's because the Austrian School is the only modern school of economic though that offers a critique of fiat currency.  — Preceding unsigned comment added by 12.7.59.8 (talk) 21:46, 30 August 2012 (UTC)
replies: text: "Fiat Currency" is not the topic of this article.SPECIFICO 01:01, 22 January 2013 (UTC)
thread_title:  Austrian School/neoclassical economics 

message: Is this really on topic here?  The article is about the event in 1971.  Krugman's statement is a general defense of fiat and discussion of floating currencies.  Maybe this should be deleted.  SPECIFICO  talk  23:45, 22 February 2013 (UTC)
thread_title:  Later ramifications 

message: The events of 1971 and 1997 may be inextricably linked, but I doubt it! Fotoguzzi (talk) 01:54, 5 April 2013 (UTC)
replies: text: Quite right.  The 1997 Asian currency crisis was brought about by events starting in 1995.  I'll delete it as an unsourced non sequitur; it should only go back if someone can source it.  Vaughan Pratt (talk) 00:10, 27 October 2015 (UTC)
thread_title:  The dollar plunged by a third during the '70s, and in 1997 several Asian and Latin countries faced currency crises. 

message: Volunteer Marek called the terms "costless dollars" and "forcing other countries to accept them" as "POV nonsense" . Well, in the Bretton Wood System accepting US dollars as payment for good was mandatory for the signatories of the agreement, not optional... And costless dollars is a indirect quotation: "it costs only a few cents to produce $100, but other countries had to pony up $100 dollars of actual goods and services in order to obtain one." You can disagree with the wordings, and I'm not opposed to cosmetic changes. But these are facts, not "pov-nonsense"... Blaue Max (talk) 01:25, 9 December 2014 (UTC)
replies: text: Same as at the Charles de Gaulle article. Please let's keep discussion in one place.Volunteer Marek (talk) 01:43, 9 December 2014 (UTC)
thread_title: US dollar crisis

message: The article jumps right into the fact that the United States had a mismatch between the gold it had and the dollars that existed without explaining that it printed more money than it had in gold. Hackwrench (talk) 05:41, 14 August 2015 (UTC)
thread_title:  Fails to introduce that the United States must have printed more dollars than it had in gold. 

message: Citation 1 gives the 1958 figure for Bretton-Woods. The [Marshall Plan] was in 1948 and not part of citation 2, but this Wikipedia article actually tones down citation 2's claims that Bretton Woods, to which is added system, worked "perfectly" "For the first years after World War II". The article substitutes appeared for seemed, and was unclear as to the start and duration of this. Hackwrench (talk) 01:28, 6 September 2015 (UTC)
thread_title:  Conflict in citations 1 and 2 

message: In "Background" section: "Countries now settled their international accounts in dollars that could be converted to gold at a fixed exchange rate of $35 per ounce, which was redeemable by the U.S. government. Thus, the United States was committed to backing every dollar overseas with gold. Other currencies were fixed to the dollar, and the dollar was pegged to gold." A fixed exchange rate is not a peg. I could see no way to fix this other than deleting the final phrase. But I am uncertain whether it is true that "other currencies were fixed to the dollar" or whether they were pegged to the dollar, so someone with more knowledge than I needs to look at this. Baon (talk) 16:44, 4 December 2017 (UTC)
thread_title:  Fixed exchange rate is not a peg 

message: Why is there no paragraph calling what the US did in 1971 as the biggest ever known sovereign default in the history of capitalism? There is a lot of literature and economists out there calling it with what this was. Can we please get more transparency even if it hurts to certain POV pushers?
217.68.187.29 (talk) 21:42, 14 January 2018 (UTC)
thread_title:  DEFAULT 

message: Quoting from the article: "and monetary inflation by the Federal Reserve caused the dollar to become increasingly overvalued in the 1960s".  How can increasing the supply of a currency cause it to be overvalued?  206.72.58.57 (talk) 02:21, 13 May 2019 (UTC)
thread_title:  How does "monetary inflation" cause the inflated money to become "over valued"?