RTFA: http://en.wikipedia.org/wiki/Bretton_Woods_system

The Bretton Woods system of monetary management established the rules for commercial and financial relations among the world’s major industrial states. The Bretton Woods system was the first example of a fully negotiated monetary order intended to govern monetary relations among independent nation-states.

Preparing to rebuild the international economic system as World War II was still raging, 730 delegates from all 44 Allied nations gathered at the Mount Washington Hotel in Bretton Woods, New Hampshire, United States, for the United Nations Monetary and Financial Conference. The delegates deliberated upon and signed the Bretton Woods Agreements during the first three weeks of July 1944.

Setting up a system of rules, institutions, and procedures to regulate the international monetary system, the planners at Bretton Woods established the International Bank for Reconstruction and Development (IBRD) (now one of five institutions in the World Bank Group) and the International Monetary Fund (IMF). These organizations became operational in 1945 after a sufficient number of countries had ratified the agreement.

The chief features of the Bretton Woods system were an obligation for each country to adopt a monetary policy that maintained the exchange rate of its currency within a fixed value-plus or minus one percent-in terms of gold and the ability of the IMF to bridge temporary imbalances of payments. In the face of increasing strain, the system collapsed in 1971, following the United States’ suspension of convertibility from dollars to gold. This created the unique situation whereby the United States dollar became the “reserve currency” for the nation-states which had signed the agreement.

FYI: The original Bretton Woods, according to Wikipedia.

RTFA: http://www.eurodad.org/whatsnew/articles.aspx?id=3…

German Chancellor Angela Merkel and French President Nicolas Sarkozy said “Bretton Woods II” should bring about “genuine, all-encompassing reform of the international financial system”. The Council of the European Union sees the meeting as “tak[ing] early decisions on transparency, global standards of regulation, cross-border supervision and crisis management, to avoid conflicts of interest and to create an early warning system, so as to engender confidence among savers and investors in every country.” In announcing the meeting, the spokesperson for US President George Bush said that “leaders will review progress being made to address the current financial crisis, advance a common understanding of its causes, and, in order to avoid a repetition, agree on a common set of principles for reform of the regulatory and institutional regimes for the world’s financial sector”. UK Prime Minister Gordon Brown, in a mid-October speech, set out several principles. These include transparency (internationally agreed accounting standards, credit insurance market standards), integrity (credit agencies, executive pay), responsibility (board member competency and expertise), sound banking practice (protecting against speculative bubbles).

For the new international architecture Brown and others are discussing an effective global early warning system for risk prevention, globally accepted standards to supervise cross-border capital flows and the activities of global firms, plus stronger institutions for cooperative action in crises. For CSOs it will be important that equity as well as stability is discussed at the conference and that fairer rules are developed for aid, debt, trade, investment, taxation and capital flight. The governance of the international financial institutions must be radically changed, fair debt workout mechanisms introduced, and much more.

Now that the election is behind us, on to new tasks… A very prominent, timely question: what will be the composition of the next global reserve currency? The US Dollar has enjoyed this position for some time, but the Dollar is in some trouble. What is the solution? That will be decided on November 15, 2008.

I’ve been calling this Bretton Woods III according to the following progression:

BW I was the agreement of world gold exchange
BW II was the agreement of the dollar reserve currency
BW III will be the establishment of a new model for global currency exchange

It seems this will be called Bretton Woods II for some reason, but no matter. The end result is a third round of negotiations for global reserve currency policy. What will this look like?