A new reserve value, the SDR was created and received the value of 0.888571 grams of fine gold, the same value as the dollar in July 1944. The United States launched the Marshall Plan for the economic recovery of the European Union in order to provide significant financial and economic assistance to the reconstruction of Europe, largely through subsidies rather than loans. The member countries of the Soviet bloc, for example. B Poland, were invited to receive the subsidies, but obtained a favorable agreement with the COMECON of the Soviet Union.  In a speech at Harvard University on June 5, 1947, U.S. Secretary of State George Marshall stated that there was a high degree of convergence among powerful nations, that the inability to coordinate exchange rates during the interwar period had exacerbated political tensions. This facilitated the decisions of the Bretton Woods conference. In addition, all the Bretton Woods governments agreed that the monetary chaos of the interwar period had brought some valuable lessons. The Bretton Woods Agreement was the result of a series of negotiations between the Allies towards the end of World War II. In 1944, nations agreed on how to build the world`s financial system after the war. The deal takes its name from Bretton Woods, New Hampshire, where negotiators met to discuss the plan. During the Bretton Woods era, the global economy grew rapidly. Keynesian economic policy has allowed governments to mitigate economic fluctuations and recessions have been generally weak.
However, tensions began to manifest in the 1960s. Persistent, albeit low, global inflation has made the price of gold too low in real terms. A chronic U.S. trade deficit drained U.S. gold reserves, but the idea of devaluing the dollar against gold was strongly opposed. In any event, this would have required an agreement between the surplus countries in order to increase their exchange rates against the dollar in order to obtain the necessary adjustment. Meanwhile, the pace of economic growth has meant that the level of international reserves has generally become insufficient; The invention of the « Special Drawing Right » (SDR) did not solve this problem. While capital controls had not yet been carried out, they were significantly lower in the late 1960s than in the early 1950s, increasing the prospects for capital flight or speculation against currencies deemed weak. The security of money by the gold standard began to become a serious problem in the late 1960s. In 1971, the problem was so serious that U.S.
President Richard Nixon announced that the possibility of converting the dollar to gold was « temporarily » suspended. The stage was inevitably the last straw for the system and the agreement that sketched it. The price to pay for this position – particularly in the Cold War climate – was the militarization of the American economy, what U.S. President Dwight D. Eisenhower called « the arms industry » and « the military-industrial complex, » and the resulting idea that the United States should play a protective role in what is called the « free world. » In retrospect to the origins of the Cold War, he lamented, in a document written by Harry Dexter White at the time of his death, the « tensions between certain great powers » that had « almost catastrophic » consequences, including an « acute lack of confidence in the continuing political stability and the crippling fear of war to an unprecedented extent and almost unimaginable in its destructive potential. » The Bretton Woods Agreement remains an important event in the history of global finance. The two Bretton Woods institutions it established at the International Monetary Fund and the World Bank played an important role in rebuilding Europe after World War II. Subsequently, both institutions maintained their founding goals while building on today`s global government interests.