MODIFIED GOLD AND DOLLAR STANDARDS (5)

The dollar as key currency ,During the great Depression of the 1930s,political unrest and fear of Hitler ’s aggression caused an avalanche of gold to flow into the united states .After world war II people said with some exaggeration that the world was in fact on a dollar standard .The American dollar was the "key currency" in terms of which international trade and finance were carried on . private and government reserves were kept largely in the from of dollar balances (i.e., in cash,bank deposits ,and liquidd short-term dollar securities ). whereas before 1914 the pound had been king by 1945 the dollar was established as the key currency .
the Bretton words conference of 1944 , which set up the international monetary fund and world Bank ,defined in it Charter the parities of currencies not simply in terms of gold ,but also in terms of dollars (then equivalent of 1/35 ounce of gold ,now 1/42).the dollar was the so-called " intervention currency " that governments used in adhering to their exchange parities .