The dollar has long been the most widespread, well-known and mentioned currency in the world. In almost any country, you can, if necessary, pay with crisp green banknotes, the dollar sign has become a part of mass culture and its popularity continues unabated.
Everyone has long been accustomed to the fact that the currency of one of the countries began to dominate the world market, without losing its popularity for many decades. Many countries officially use US dollars as their sole or complementary currency. Money with portraits of American public and political figures can be paid in various countries. In the nineties, in Russia, which was once a bastion in the fight against the United States and its currency, it was easier to pay for more or less large purchases with stable dollars than with rubles that are constantly losing price. Many companies, from large businesses to home appliance stores, have quoted prices in dollars.
Towards the end of World War II, in 1944, the countries of the Anti-Hitler Coalition agreed to use the US dollar as the world's reserve currency. This made it possible to stabilize the rates of other currencies, thanks to their flexible pegging to the dollar, thanks to which the exchange rates could not fluctuate by more than 1 percent. The dollar itself was pegged to the gold standard, as the United States at that time possessed most of the world's gold reserves. The cost of a troy ounce of gold was set at $ 35 per ounce. To stabilize exchange rates, governments of states had to buy or sell dollars.
In honor of the city of Bretton Woods, where the historic agreement was signed, this system of international finance was named Bretton Woods. It turned out to be a very successful solution and led to the rapid and stable growth of the world economy. At the same time, the Bretton Woods system quickly led to the dollarization of the economies of the countries of the world and, as a consequence, their transition to partial control by the Federal Reserve System, and in the United States - to an accelerated waste of the gold reserve.
From 1976 to 1978, the Bretton Woods system was replaced by the Jamaican one, which removed the dollar's peg to the gold standard, making gold a commodity. At the same time, currencies “went free floating,” that is, their rates were no longer pegged to the dollar. One of the goals of abandoning the Bretton Woods system was to reduce dependence on the policy of the US Federal Reserve System, but in practice the consequences were exactly the opposite. The Fed was now free of the gold standard and could practice unlimited emission. Developing countries began to pay for access to the American market in dollars, which, despite the absence of gold backing, remained the most convenient means of payment.
The American economy made huge profits by paying international payment obligations in dollars. However, the country's external debt continued to grow at an alarming rate. By the late 1980s, the US economy could have suffered severely, but the collapse of the Soviet Union added a number of countries trading with the US and using the dollar to Eastern European, African and Asian states. At the moment, despite the presence in the markets of such large players as the European Union, China and India, the world still uses the US dollar. In Europe, the euro competes with the American currency, but the popularity of banknotes with presidents does not decline.
