Gold Exchange Standard

The British gold standard finally collapsed in 1931, but the system was revived at the 1944 international conference held in Bretton Woods, New Hampshire. Here, a revised gold standard was agreed upon: the exchange rates of the national currencies of the major economic powers were pegged to the dollar and the dollar was convertible into gold at a fixed price of USD 35 per ounce. The Bretton Woods monetary system is therefore sometimes called the gold exchange standard. Central banks stood ready to provide dollars in exchange for their national currency and vice versa.

The Bretton Woods monetary system collapsed in 1971 and since then the currencies of the major economies have remained pure fiat money. In addition, most countries have allowed the exchange rates of their currencies to float.

The evolution of money has not stopped. These days, various forms of intangible money have emerged, among them so-called “electronic money” (“e-money”), or electronic means of payment, which first appeared in the 1990s. This kind of money can be used to pay for goods and services on the internet or using other electronic media.

Upon receiving authorization from the buyer for the payment to take place, the vendor contacts the issuing bank and is transferred the funds. At present there are various card-based electronic money schemes in Europe, generally operated by financial institutions.

Vocabulary List

1. portable – легкий, переносимый

2. durable - прочный, долговременный

3. to decay - портиться

4. divisible – делимый

5. fiatmoney – неразменные (декретные) деньги (выпускаются правительством, не имеют реальной стоимости)

6. todecline – приходить в упадок, снижаться

7. to certify – удостоверять; ручаться

8. indebtedness – задолженность, сумма долга

9. obligation – обязательство, долг; долговое обязательство

to take on, assume obligation

10. billofexchange – переводной вексель, тратта (финансовый документ – приказ должнику уплатить указанному лицу определенную сумму)

11. to undergo – испытывать, подвергаться

12. legal tender – законное платежное средство

13. nominalvalue – номинальная стоимость

syn. facevalue

14. GoldStandard – Золотой Стандарт (денежная система, при которой все денежные единицы страны могут обмениваться на золото)

15. circulation – обращение

v. to circulate

16. nationalgoldreserves – официальные резервы государства в форме золотых слитков

Notes

1. GoldExchangeStandard – золотовалютный (золотодевизный) стандарт

2. fiduciarypapernotes – деньги общественного доверия (деньги, обеспеченные золотым или серебряным резервом)

3. tobeconvertedintogoldatafixedparity – обмениваться на золото по фиксированной стоимости

4. to suspend – приостанавливать, временно прекращать

5. tobepegged (to) – быть «привязанным» к определенному уровню (о цене или курсе)

6. to float – плавать, свободно колебаться

Ex 1. Suggest the Russian equivalents:

their original purpose; to be stored conveniently and easily; to be easily portable and durable; these goods came to be accepted as money; money without intrinsic value; certificates of indebtedness; to trade obligations; the bi-metal scheme; the adoption of fiat money; the system has undergone great change; legal tender; to ensure the creditability of currency; the exchange rate of pounds into gold; to be balanced by the national gold reserves; to be pegged to the dollar; to float; intangible money.

Ex 2. Fill in the gaps with the words and expressions from the text.

1. It is widely agreed that what at times became … was often not the same as ……

2. The evolution of money depends on a number of factor, such as ……

3. The introduction of metallic money was a way by which …… tried to overcome the problem …… as money

4. Paper money in China was …… around 15000 A.D. when Chinese society ……

5. The Italian city-states were the first …… as a means of payment.

6. For a long time, the nation states held …… in their central banks …… - a system known as the Gold Standard.

7. Whit the start of WWI, many countries began …… in order …… of the war.

8. These days, various forms of …… have emerged, among them so-called ……, or …….

Ex 3. Find in the text the English equivalents for the following:

играть основную (ключевую) роль (2), изначальная цель, решать проблемы, внести в обращение стандартизированные и сертифицированные монеты, города-государства, содержание серебра, широко использоваться, заменять серебро и золото сплавами, не иметь товарной (потребительской) стоимости, долговые обязательства (3), приход бумажных денег, законное платежное средство, иметь строго определенную номинальную стоимость, конвертироваться в золото по установленной цене, уравновешиваться национальным золотым запасом, золотодевизный стандарт, деньги, не имеющие материальной формы.

Ex 4. Match each term with the appropriate explanation.