by James Hickman
Schiff Sovereign
On June 8, 1974, President Richard Nixon dispatched Treasury Secretary William Simon and his deputy to Saudi Arabia in an attempt to strike one of the most critical—and secretive—economic deals in modern history.
Three years earlier, in August 1971, Nixon had severed the final link between the US dollar and gold, officially ending the Bretton Woods system. That meant foreign governments could no longer redeem their dollars for gold, effectively turning the dollar into a pure fiat currency backed by nothing but political promises.
After Nixon’s move, the US could effectively ‘print’ and spend as much money as it wanted—something that Congress enthusiastically embraced.
Inflation soared, confidence in the dollar plummeted, and foreign countries began dumping dollars as a result.