The 1944 Bretton Woods Agreement established a new global monetary system. It replaced the Pound Sterling as the International Reserve Currency with the U.S. dollar, and it still maintained the Gold Standard.
Before and after the Bretton Woods Agreement, most countries followed the gold standard, which meant each country guaranteed that it would redeem currency for its value in gold.
The reason given for the U.S. dollar becoming the international reserve currency was the U.S. held three-fourths of the world’s gold supply, and no other global currency had enough gold to back it as a replacement. The U.S. dollar’s value was stated to be 1/35th of an ounce of gold. Bretton Woods allowed the world to slowly transition from the Pound Sterling to a U.S. dollar standard without anyone really understanding the significance of what was taking place.
The dollar had now become a substitute for gold, which had been a source of money of true value all over the world for 4,000 years. As a result of the financial transition from the Pound Sterling towards the U.S. dollar the transition away from a Gold Standard began even though no one actually knew what was happening at the time, because the U.S. did not hold / own enough gold to pay off its debts.
The U.S. dollar was the acceptable method of payment instead of gold. As a result, the value of the U.S. dollar began to increase relative to other global currencies. There was more demand for the U.S. dollar even though its worth in gold remained the same.
This usage of the U.S. dollar combined with the United States Navy controlling global sea lanes helped establish America as the dominant power in the world economy. After the Bretton Woods Agreement was signed, America was the only country legally permitted to print U.S. dollars, although it has been documented that the America abused that law and allowed Allies to print U.S. dollars on its behalf.
The Bretton Woods agreements created the World Bank and the International Monetary Fund (IMF), U.S. backed organizations that were intended to facilitate the new financial system.
The Bretton Woods Agreement remains an important part of world financial history. Creation of The International Monetary Fund (IMF) and valuation of gold and foreign exchange rates remain important to this day. The agreement also made currencies convertible for trade and other current account transactions.
The strong value of the U.S. dollar eventually led to the collapse of the system after more than 20 years. U.S. President Richard Nixon called for a suspension of the Bretton Woods Agreement in August 1971, together with the complete removal of the Gold Standard, when it collapsed. The agreement was dissolved between 1968 and 1973. In 1973, the Bretton Woods Agreement officially ended.
FORTRESS AMERICA IS THE END OF BRETTON WOODS
Today, Bretton Woods is alive in theory and manipulation only. It is what is being practiced as a financial fiat money, fractional reserve, ponzi scheme banking system, even though Bretton Woods and all the intended collateral agreements were never implemented into the financial system as they were intended to be by the original framers. Now the remnants of Bretton Woods are coming to an end as the world of politics and finance merge into a new world order.
In America, President Trump calls it MAGA – Make America Great Again. In an interview with USAwatchdog.com, investment counselor Catherine Austin Fitts termed it “Fortress America,” which is what she says America is in the process of becoming.
It’s all because the world is experiencing a changing of the guard on many social, political, and spiritual ends. Financially, it is a return to the past that was never allowed to materialize in the form of a new global financial system that actually backs each sovereign nation’s sovereign currencies with pure gold. This is what the Bretton Woods Agreement and its ancillary secret and private agreements were intended to accomplish.
But after World War II we got a diluted Bretton Woods, the purposefully hijacked version of the new financial system where the global “attractor” became the American Consumer and America rose based on the strength of the U.S. Navy controlling the world’s sea lanes. It was an open trade model and the world said they wanted to trade, gun barrels pointed at them or not. America became the undisputed protector of global trade routes which created power in our nation and national currency.
But that system is breaking down to near nonexistence now, and we’re seeing a lot of the blame being given to the current presidential administration in the U.S. But is that fair? Wasn’t Bretton Woods actually a corrupt and hijacked system that was always meant to fail as the elite used it to steal wealth from the programmed masses for over a century, until we finally caught on?
The reality is the Bretton Woods system has been breaking down for a while, especially since the removal of the Gold Standard in August 1971 by U.S. President Richard Nixon; and the acceleration of that breakdown was expected, Austin Fitts says to Greg Hunter at USAwatchdog.com. “And that’s why you’re seeing so much renegotiation of a lot of the trade agreements. Trying to keep the Bretton Woods system economic.”
That’s the way the world works. You have to benefit from being the reserve currency and getting lots of natural resources cheap. At the same time you have a very expensive military to upkeep and you’ve got to run it. So the money you’re spending for military and running the system is less than the benefit you’re getting out of it, which is where America finds itself today.
TWO FACTIONS IN AMERICAN ESTABLISHMENT
In America we have two factions that are battling to figure out into which direction we’re going to take our military and money. “Now what I believe was one of the key drivers in the election was you had two factions in the American Establishment. And one of them wants to pull back behind the oceans into ‘Fortress America.’ Now, with drones and other technology you can project power, not by running a global military, but by using drones and space weaponry and other things to project power just from North America,” Austin Fitts says.
The path we’re following appears to be leading to a renewed emphasis to rebuild the base at home and it’s involving high tech, artificial intelligence, and robotics. “Part of that, as I said, is now with robotics and AI. You can bring a tremendous amount of the manufacturing and operations you need for national security back into North America. So what you’re seeing is a consolidation of the base back into North America and making North America strong,” Austin Fitts says.
So whichever way you choose to view the acceleration of the end of the Bretton Woods system we will all agree that we are witnessing a shift into a new multipolar world, with a new emphasis toward spending and reorganizing the way America’s military might is deployed. America can be effective in that world.
If you look at what’s happening in the federal budget it’s a fine dance between getting the Bretton Woods system to continue and go, even though it is only a skeleton of itself, and the reserve currency to continue and go versus rebuilding. Austin Fitts asserts, “Whether Trump calls that ‘Make America Great Again’ or I call it ‘Fortress America’ you’re doing something that from the vantage point of the concrete business make a whole lot more sense.”
THERE IS A LAND EMPIRE TO BE CONQUERED
… So let’s go back. The Bretton Woods system was a maritime Empire. The U.S. Navy and before that the British Navy, what Austin Fitts calls “the Anglo-American Alliance”, controlled the world because they controlled the sea lanes in an open trade model where the U.S. consumer was the attractor, she says in the interview.
“Now you have the European Union, whose middle class is double the size of America and you have Asia whose middle class by 2030 if the Brookings Institute is right is going to be ten times the America middle class. And what’s between them? Yes, there’s some ocean between them but there’s a land empire and what Xi Jinping and China and Asia are doing is they are building the roads and they are building the railroads. That means Europe and Asia can trade with each other at high speed,” she says.
Now, let’s look at per capita income. “If the per capita income today in China is $10,000 to $15,000 and the per capita income in America is $60,000 and in Switzerland it’s $80,000. And if you build a land empire between Europe and Asia as Asia is going from $15,000 up to $60,000, converging with the G7, what’s going to happen?” Austin Fitts asks on USAwatchdog.com.
You’re going to have the ‘Silk Road’, Austin Fitts answers. And Europe and Asia are going to team up and “cut you out!”
WARS IN EURASIA CONNECT EUROPE TO ASIA
If you look at the last ten years we’re having wars all over the world that seem to back up exactly what Austin Fitts is saying. It’s war conquering Eurasia.
And where is Eurasia? It is the giant land mass that connects Asia and Europe and sits between Europe and China.
The Ukraine. Turkey. Iran. Syria. Iraq. Libya. “That’s what this fight is about,” Austin Fitts says. Who’s going to control the ‘Silk Road’, and is the ‘Silk Road’ going to support the “Anglo-American Alliance”? Or is it going to support Europe and China getting together and doing it themselves?
And then there’s the great ‘Demon State’ of Russia that umbrellas both of them in the middle – from Europe to Asia. Could this all really be about Russia, India, China, and Europe getting together to remove what bits are left of the Bretton Woods financial system in the West while carving up amongst themselves the new ‘Silk Road’ — and cutting us out?
Isn’t that what the wars in the Middle East are all about? “Isn’t this why Xi Jinping is making the One Belt One Road initiative such a huge priority for the Chinese?” Austin Fitts asks. And where are we in all of that?
“For the past two decades China has been buying Treasuries and then we’ve taken that money and then handed out subsidies who then go down to Walmart and buy Chinese goods and round the merrygo round we go,” Austin Fitts says. So China has been exporting labor deflation to us while financing the U.S.
Chinese money will no longer buy our bonds with the money being paid out in subsidies that buy Chinese goods from Walmart. China has more important – and lucrative – things to do.
“Now, instead of buying Treasuries and financing our trade deficit, China says, no, I’m not going to finance you. I’m going to finance building a land empire, which is an alternative to your Bretton Woods system in a way that makes us beaucoup money,” Austin Fitts concludes.
And what does that do? That means China is now financing the rise of the Asian middle class and the rise of their land empire, while maybe teaming up with Russia, Asia, and the rest of the world and leaving America out.
Greater synergy is taking place between Russia, India, and China, nations who will be working together to pull their nations through anticipated global volatilities like a global depression that lie ahead.
Commentator on risk-related geostrategic issues Dr. Mathew Maavak sums it up this way on activistpost.com: “In the meantime, as the U.S.-led world crumbles, it looks like Russia is patiently biding time to become the security guarantor and kingmaker of Asia-Europe trade. A possible state of affairs wrought more by American inanity rather than Russian ingenuity.”
And what does all that do? It exports inflation to America, Catherine Austin Fitts says. John Williams of Shadowstats.com says real inflation in this country is running at around 10 percent.
One of the reasons is Asia is no longer exporting deflation to America. It’s exporting inflation and we in the West are getting killed as a result thereof.
