WTF happened in 1971 actually happened in 1968.
As we’re all watching price these last few days (we're allsuckers…?) let’s take the wisdom of price 1 seriously as we investigate this patchwork of a misunderstood term that is “the gold standard.”
So, first off: Bretton Woods (1944-1971) wasn’t the gold standard. At best it can be described as a faulty dollar-based monetary system with some gold (probably in Fort Knox, but who knows really?) at the base of it. The term gold standard is what us economic historians reserve for the classical one, roughly 1870 to 1914—also known as the golden era, or the one that Trump surprisingly enough celebrated recently on Joe Rogan2 : Growth like crazy, prices falling or stable, gold the world’s money, life-changing innovations left right and centre, no income tax and the small federal government financing itself mostly via tariffs. 3 The income tax was declared unconstitutional by the Supreme Court in 1895 4
dudez had balls back then. But I digress.
A gold standard is sometimes described as a fixed-exchange rate to gold. (It’s a little silly, since under the CGS gold just was money, there was no fixing or exchange rate involved.) Point is, the Bretton Woods system did operate with a fixed dollar rate to gold: Other currencies were held at specified managed rates to the dollar (see previous MONEY CLASS piece: #747181), and dollar was held at $35 to an ounce of gold.
But gold has a global supply/demand market of its own, making pegging it to a specific currency tenuous at best. Fast-forward through the Triffin dilemma (where the U.S. simultaneously had to supply more and less dollars to the world5), the major countries of the day “pooled” a lot of gold in London to keep the dollar price of gold in check at $35, intervening on the market by buying or selling to steer the gold price back to its policy "anchor." It’s a short and checkered history that eventually broke entirely in March 1968, after which the market price of gold went permanently above that rate.
Thus, thousands of years of human history, wrote Scott Sumner in his The Money Illusion "ended with a whimper on March 14, 1968, when commodity money was effectively dead.”
In a footnote he adds that most people erroneously focus on 1971 August and the Nixon Shock, but that's inessential since "what matters is the market price of gold, which began rising in 1968.”

On the other side of Bretton Woods, it didn’t even start in 1944 as is commonly believed. Anyone who’s observed a bureaucracy or nation-state negotiation must understand that signing an agreement in a fancy New Hampshire hotel during the summer of 1944 not a global agreement makes.
Definitionally, it’s a little unclear what “begin” even means:
  • March 1954 when London gold market opens?
  • February 1955 when New York officially makes sterling transferable? (During and after WWII, Britain used imperial power and law to block sterling assets among its former empire.)
  • or 1958, per Fed historian Robert Hetzel, when “the major European countries allowed their currencies to be freely convertible into foreign currencies for current account transactions”? (i.e., capital controls fully gone) 6
Lyn Alden illustrates this broken system pretty well. From start to finish, the U.S. was bleeding gold reserves.
Oops.
Tl;dr—a gold standard is a predictable/stable/credible rate to gold. When market prices have moved against that (i.e., credibility lost), you’re screwed. Bretton Woods, usually dated 1944-1971, lasted only a decade or so—from its gradual and heavily regulated start in the 1950s to the gold price broke out in 1968.
So, it should be WTF happened in 1968!
Two more nice resources: IMF "Money Matters: System in Crisis" 7
"The Gold Pool (1961-1968) and the Fall of the Bretton Woods System: Lessons for Central Bank Cooperation" (Bordo, Monnet, and Naef) 8
That's today's little money lesson. Peace, J

Footnotes

What happened afterwards!
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I gave a talk on prices and why they are information and important today in my class !
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Cool! What do you teach?
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I teach economics and ethics at a local school for grades 8 to 10.
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your kids are getting quite the education (and sats, it seems: #763705)
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Trying my best here!
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I hadn't thought about this before, but of course formally ending gold convertibility was the culmination of something that had already occurred.
There will likely be some similar dating issue, when future economic historians are attempting to identify the impact of the US defaulting on its debt obligations (which will eventually happen) on the purchasing power of the dollar. Most sane people already know that default is coming, so the effect on purchasing power is already happening.
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Indeed, indeed.
Future historians are gonna have a field day figuring out wth happened when and why
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TIL it was the gold price breaking out in 1968 that made us leave the gold standard in 1971
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