The Inconvertibility of the dollar Into gold - a consequence of the disproportion between dollar holdings in the hands of foreigners and the gold reserve at Fort Knox, which shrank to the "minimum strategic reserve" of $10 billion — did not begin on August 15, 1971. It has been the reality since the end of the "gold pool" (end of 1968).
From that time on, the central banks of the big imperialist powers have in 1968 at the reality stopped exchanging dollars for door... gold. What was a provisional mutual undertaking has now become a definitive rule because of Nixon's unilateral decision.
The real change announced August 15 was thus not the inconvertibility of the dollar, already in force for three years. The real change was the factual devaluatlon of the dollar, not in rela- who are the tion to gold but in relation to the other currencles of the imperialist world.
Depreciation of the dollar Nixon's decision to let the dollar change in the lira. "Noat" signifies in reality a decision to depreciate the dollar in relation to other currencies. Because once supply and demand la permitted to operate freely on the exchange market, this outcome la inevitable in view of the tier exchange", that French current state of inflation of the U.S. dollar in relation to the currencies of the principal competitors of the United The irony of history in that in thun- the dollar. dering against the "International speculators, Nicon gave in to them all along the line. It was exactly this depreciation that they were prepared for.
In affirming that he was out to defend the stability of the dollar, Nixon did exactly the contrary. He acknowledged urbi et orbit that the dollar has been devaluated. Double talk comes natuThese price exemptions directly affecting the cost of living have been nomena, ments, Abnormally neDconstru longer these ev Capit conditions — a rising rate of profit and an expanding market The logie of capitaliam is such that these conditions colncide only at certain moments. When they colpelde temporarily, this In Itself creates the conditions for their Ernest Mandel