ECLECTICS:WHAT DID WE LEARN FROM KEYNES?PART 19

balance of trade and protect domestic industries.Not only did he raise import prices,he removed United States from the gold standard,stopped backing the dollar with gold in 1971,which had once kept dollar value tiedto a fixed amount of gold as it were under the 1944 Bretton Woods agreement.Many countriesdecided their choices and were either pegged to the dollar or gold,making the dollar a global interventionist currency.This phenomenalfeat wrought by the man that was later haunted,chased out of office by watergate scandal could have baffled keynes,had he lived to witness this change of new global economic order.The problem started when the United Kingdom decided to redeem $3billion and the United States didnt have sufficient volume in her reserves at Fort Knox.Hence,Nixon stopped the practice of redeeming dollar with gold,skyrocketed the price of precious metals and dollar value plummeted.Import prices too grew and growth slowed even more when the United States companies couldnt raise prices to make a profit.