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The Triffin dilemma or Triffin paradox is the conflict of economic interests that arises between short-term domestic and long-term international objectives for countries whose currencies serve as global reserve currencies. This dilemma was identified in the 1960s by Belgian-American economist Robert Triffin, who pointed out that the country whose currency, being the global reserve currency, foreign nations wish to hold, must be willing to supply the world with an extra supply of its currency to fulfill world demand for these foreign exchange reserves, leading to a trade deficit.
The Nixon shock was a series of economic measures undertaken by United States President Richard Nixon in 1971, in response to increasing inflation, the most significant of which were wage and price freezes, surcharges on imports, and the unilateral cancellation of the direct international convertibility of the United States dollar to gold.
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A fixed exchange rate, often called a pegged exchange rate, is a type of exchange rate regime in which a currency's value is fixed or pegged by a monetary authority against the value of another currency, a basket of other currencies, or another measure of value, such as gold.
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Prior to European colonization, early Aboriginal Australian communities traded using items such as tools, food, ochres, shells, raw materials and stories, although there is no evidence of the use of currencies.
References
- ↑ Burda, Wyplosz (1997). Macroeconomics: A European Text (2nd ed.). Oxford University Press. ISBN 0199264961.
- ↑ Helmut Lipfert, Einführung in die Währungspolitik, 1973, S. 121 f.
- ↑ Hauke Rath, Wirtschaft, Geld und Börse in der Zeitung, 2000, S. 273
- ↑ Bernd Engel/Hans Herber, Volkswirtschaftslehre für Studium und Bankpraxis, 1983, S. 252
