GOING DOWN

New Yorker, The, December, 2004 by John Cassidy

Americans long ago became accustomed to the pleasing notion that there is nothing quite so sound as the dollar. During the nineteen-twenties and thirties, when Pound, Hemingway, and Stein were in Paris, they lived on modest remittances from home which, translated into francs, bankrolled lazy afternoons in the Jardin du Luxembourg and giddy evenings on the Boulevard Montparnasse. "Two people, then, could live comfortably and well in Europe on five dollars a day and could travel," Hemingway wrote. Near the end of the Second World War, an international conference in Bretton Woods, New Hampshire, confirmed the American currency's role as the linchpin of the global economy, setting up a system of fixed exchange rates that survived for almost thirty years, and ushering in an age of...