WTF Happened in 1971? (And in Afghanistan?)

The Breakdown

Blockworks

Investing, Business

4.8 • 786 Ratings

🗓️ 17 August 2021

⏱️ 16 minutes

🔗️ Recording | iTunes | RSS

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Summary

On this episode of “The Breakdown,” host NLW takes a step back from the nitty-gritty of markets and politics to examine current events from the global macro perspective, including: The 50th anniversary of the “Nixon Shock” – aka the end of the gold standard Afghanistan news and the fall of Kabul This weekend marked the 50th anniversary of when President Richard Nixon decoupled the USD from the gold standard. That event in 1971, which upended the world of finance, contributed in a large way to the rise of cryptocurrencies. The site “WTF Happened In 1971?” has chronicled the impacts of Nixon’s decision in the years since with extensive data covering wages, productivity and more. Can 50 years of financial transformations be traced back to one event? In global news, the Afghan government’s struggle against the Taliban has reached a critical point as Taliban forces have taken Kabul, the capital. The news comes after the U.S. withdrew its troops after a 20-year war. This global event is bound to affect the financial system, but it also has ties to cryptocurrencies as they are a new, completely external tool to provide citizens in tumultuous regions agency over their money in a way that has never been possible before. Enjoying this content? SUBSCRIBE to the Podcast Apple: https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M= Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW “The Breakdown” is written, produced by and features NLW, with editing by Rob Mitchell and additional production support by Eleanor Pahl. Adam B. Levine is our executive producer and our theme music is “Countdown” by Neon Beach. The music you heard today behind our sponsor is “Only in Time” by Abloom. Image credit: Paula Bronstein/Stringer/Getty Images News, modified by CoinDesk.

Transcript

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0:00.0	The strength of a nation's currency is based on the strength of that nation's economy,
0:04.0	and the American economy is by far the strongest in the world.
0:09.0	Accordingly, I have directed the Secretary of the Treasury to take the action necessary
0:15.0	to defend the dollar against the speculators.
0:18.0	I have directed Secretary Connolly to suspend temporarily the
0:21.8	convertibility of the dollar into gold or other reserve assets, except in amounts and conditions
0:28.5	determined to be in the interest of monetary stability and in the best interests of the United
0:33.3	States. Welcome back to The Breakdown with me, NLW.
0:40.2	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:47.3	The breakdown is sponsored by Nidig and produced and distributed by CoinDesk.
0:53.7	What's going on, guys? It is Monday, August 16th, and boy, oh boy, for someone who says
0:59.2	they're interested in big picture power shifts, this weekend sure had a lot to think about.
1:05.7	It was, of course, the 50th anniversary of one of the key preceding historical events that would
1:10.6	eventually lead to the
1:11.7	rise of Bitcoin. That event, of course, was the Nixon shock, when then-president Richard Nixon
1:17.3	decoupled the U.S. dollar from gold backing and began the new free-floating fiat era.
1:23.5	That clip you just heard was from a video shared by Michael Goldstein, aka Bitstein on Twitter,
1:28.5	which was later retweeted by Wyoming Senator Cynthia Lummis with this statement,
1:32.5	monetary policy has consequences.
1:35.1	Write a 50-year wrong. Return to sound money.
1:38.8	Hashtag WTF happened in 1971.
1:41.9	Hashtag Bitcoin.
	...

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