Nixon Ends Bretton Woods, Wage-Price Freeze and Tariffs

radical economic actions from a Republican president, targeted at “international money speculators” and “unfair exchange rates” …. will this happen again? i think the only questions are: when? and what?

On August 15, 1971, President Nixon announced on TV 3 dramatic changes in economic policy. He imposed a wage-price freeze. He ended the Bretton Woods international monetary system. And he imposed a temporary surcharge (tariff) on all imports. The Bretton Woods system was created towards the end of World War II and involved fixed exchange rates with the U.S. dollar as the key currency – but also a role for gold linked to the dollar at $35/ounce. The system began to falter in the 1960s because of an excess of dollars flowing out of the U.S. which foreign central banks had to absorb. A run on gold in 1968 was stemmed by a patch on Bretton Woods known as the two-tier gold system. All of this was ended unilaterally by the Nixon decision. After a brief attempt to create a modified fixed exchange rate system, the world moved to flexible rates.

via YouTube – Nixon Ends Bretton Woods International Monetary System.


The Liberal’s Platform (Andrew Coyne)

The Grits would not send us to poorhouse overnight. But their economic policies are not the kind that would tend to enhance our prospects either. And over the longer term, as the population ages and a massive increase in costs meets a shrinking labour force, we are going to need those sorts of policies, desperately. The only way the next generation will be able to afford this generation’s dotage is if they are much wealthier than we are. And the only way that will happen is if we start now to generate much faster rates of annual productivity growth, and go on doing so, year after year, for the next several decades.

Measured against that benchmark, the Liberal platform starts to look more alarming. The Family Pack of social benefits, for students, pensioners, caregivers and so on, may be delightful ideas in themselves. But they come unaccompanied by any comparable concern with producing the wealth to pay for them. .

The document reveals throughout a vision of the economy as a thing, a lump of clay to be pushed, prodded, and massaged to the designs of its government makers — not an interconnected network of millions of individuals, each with their own agendas, values and interests, connected by prices and disciplined by competition, and vastly unknowable to any planner or architect. The latter view would tend to see the productivity question as a matter of allowing individuals greater freedom to innovate, by lowering taxes on investment, and giving them no option but to do so, by lowering barriers to competition. The Liberal approach is rather to offer up yet another program, an Innovation and Productivity Tax Credit, on the theory that a) we don’t have nearly enough of those already, and b) innovation comes from the Canada Revenue Agency.

via That Seventies Platform – Andrew Coyne’s Blog –

RIM and their options

As I see it RIM has three options but only two of them have any hope of helping them retain relevance in the “smart device” market. They can keep doing what they’re doing and ignore the obvious sea-change. They can adopt Android and become a commodity player banking on their ability to integrate BBM and some backend mojo to get an edge on other Android-based competitors or they can chart their own course with their own software and hardware combination.

Right. RIM has picked the option that you, as an Apple aficionado, would say that you’d pick but, odds are, you’d probably just cave and ship an Android based device.

via kickingbear» What Would RIM Do?.