Is it time to restore the gold standard?

When Richard Nixon closed the 'gold window' in 1971, America began printing unlimited quantities of money to fund its spending. Now, that practice is being called into question, and the debate on reverting to some form of gold standard for the world's monetary systems is growing stronger. Simon Wilson investigates.

What is America's unique advantage'?

The US consistently imports more goods and services than it exports. Indeed, it has not run a trade surplus since 1974. For most countries, such a situation would be impossible to sustain, since over the long run they need income from exports to pay for imports. For America, however, with the world's only reserve currency used to settle most international trade it is possible to fund the gap by creating new dollars to buy things with. This is in one sense a unique advantage dubbed America's "exorbitant privilege" by Valery Giscard d'Estaing, then France's finance minister under de Gaulle in the mid-1960s.

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Simon Wilson’s first career was in book publishing, as an economics editor at Routledge, and as a publisher of non-fiction at Random House, specialising in popular business and management books. While there, he published Customers.com, a bestselling classic of the early days of e-commerce, and The Money or Your Life: Reuniting Work and Joy, an inspirational book that helped inspire its publisher towards a post-corporate, portfolio life.   

Since 2001, he has been a writer for MoneyWeek, a financial copywriter, and a long-time contributing editor at The Week. Simon also works as an actor and corporate trainer; current and past clients include investment banks, the Bank of England, the UK government, several Magic Circle law firms and all of the Big Four accountancy firms. He has a degree in languages (German and Spanish) and social and political sciences from the University of Cambridge.