Chicago PlanThe Chicago Plan was introduced by University of Chicago economists in 1933 as a comprehensive plan to reform the monetary and banking system of the United States. The Great Depression had been caused in part by excessive private banklending, so the plan proposed to eliminate the private bank money creation method of fractional reserve lending. Centralized money creation would prevent booms and busts in the money supply.
Bretton Woods systemFinancial-economic agreement reached in 1944The Bretton Woods system of monetary management established the rules for commercial relations among 44 countries, including the United States, Canada, European countries, and Australia, after the 1944 Bretton Woods Agreement until the Jamaica Accords in 1976. The Bretton Woods system was the first example of a fully negotiated monetary order intended to govern monetary relations among independent states.
Fiat moneyFiat money or fiat currency is a type of government-issued currency, generally created by a central bank, authorized by government regulation to be legal tender but not backed by a precious metal, such as gold or silver, nor by any other tangible asset or commodity. Since the end of the Bretton Woods system in 1976 by the Jamaica Accords, all the major government currencies in the world are fiat money. Fiat money generally does not have intrinsic value nor a use value.
Gold standardA gold standard is a monetary system in which the standard economicunit of account is defined by a fixed quantity of gold. The gold standard was the basis for the international monetary system from the 1870s to the early 1920s, and from the late 1920s to 1932 as well as from 1944 until 1971, when the United States unilaterally terminated convertibility of the US dollar into gold, effectively ending the Bretton Woods system.
Fractional-reserve bankingFractional-reserve banking is the system of banking under which banks that take deposits from the public keep only part of their deposit liabilities in liquid assets as a reserve, and lend a percentage to borrowers, thus increasing the money supply by the loaned amount. Bank reserves are held as cash in the bank or as balances in the bank's account at the central bank.Austrian school of economicsThe Austrian school of economics is a heterodox school of economic thought that advocates strict adherence to methodological individualism, which is the theory that social phenomena result primarily from the actions of individuals, each motivated by their own self-interest. Austrian-school theorists hold that economic theory should be exclusively derived from basic axioms of human action, known as praxeology, rather than primarily from statistical analysis.
ConvertibilityConvertibility is the quality that allows money or other financial instruments to be converted into other liquidstores of value. Convertibility is an important factor in international trade, where instruments valued in different currencies must be exchanged. Currency tradingFreely convertible currencies have immediate value on the different international markets, and few restrictions on the manner and amount that can be traded for another currency.
MoneyMoney is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money are: medium of exchange, a unit of account, a store of value and sometimes, a standard of deferred payment.
Economic impact of the COVID-19 pandemicThe COVID-19 pandemic caused far-reaching economic consequences including the COVID-19 recession, the second largest global recession in recent history, decreased business in the services sector during the COVID-19 lockdowns, the 2020 stock market crash (which included the largest single-week stock market decline since the 2008 financial crisis), the impact of COVID-19 on financial markets, the 2021–2023 global supply chain crisis, the 2021–2023 inflation surge, shortages related to the COVID-19 pandemic including the 2020–2023 global chip shortage, panic buying, and price gouging.
2008 financial crisisWorldwide economic crisisThe TED spread, an indicator of perceived in the financial system, increased significantly during the crisis. It spiked sharply in August 2007, remained volatile for a year, and spiked even higher in September 2008 to reach a record 4.65% on October 10, 2008.A major worldwide financial crisis centered in the United States took place in 2008.
Great DepressionThe Great Depression was a severe global economic downturn from 1929 to 1939. The period was marked by high rates of unemployment and poverty, drastic reductions in industrial production and international trade, and widespread bank and business failures around the world. The economic contagion began in 1929 in the United States, the largest economy in the world, with the devastating Wall Street crash of 1929 often considered the beginning of the Depression.
World War IGlobal conflict from 1914 to 1918BelligerentsAllied Powers: France United Kingdom and Empire:Australia Canada Ceylon EgyptNewfoundlandNew Zealand India South Africa Russia (until 1917) Italy (from 1915) United States(from 1917) Japanand others ...Central Powers: GermanyAustria-HungaryOttoman Empire Bulgaria (from 1915)and others ...Commanders and leadersCasualties and losses 15–22 million deaths (military and civilian)World War I, or the First World War (28 July 1914 – 11 November 1918), also known as the Great War, was a global conflict between two coalitions: the Allies (or Entente) and the Central Powers.*As an Amazon Associate I earn from qualifying purchases.