 بسم اللہ الرحمن الرحیم In this essay I will discuss the dollar based global trading system. This system affects the lives of all of us. but very few understand how it works. The first world war ended the gold based trading system and the second world war was the final nail in scuffan.The Bretton Woods conference was held to find an alternative and the US Dollars was selected to replace gold because the US still had substantial stocks of gold reserves. This asymmetric system puts the dollar at the center of global trade and gives enormous power to the USA. An alternative proposal of gains for a more symmetric trading system was crushed by the USA. To put it crudely, the Bretton Woods system was to equate dollars to gold. This worked fine for a while until the expenses of the Vietnam war led to excess printing of dollars. Nixon was forced to suspend or delink dollars from gold and renounce the Bretton Woods agreement. With the dollar delinked from gold, a system of floating currencies naturally came into existence. There's an enormous uncertainty about how the system was going to work and many predicted that it would collapse. The Hunt brothers گرنت the world silver market or tried to do so because they thought that this system would collapse and world would go back to gold and silver. The US was aware of the precarious position of the dollar unbacked by gold and negotiated a deal with Saudi Arabia to ensure that all oil trading would be done in dollars. This effectively ensured that the dollar became backed by the global oil trade instead of gold. Before the Nixon shock, the US had to maintain gold reserves in order to purchase things with dollars abroad. But after dropping the gold backing, the US effectively gets to print dollars and trade this paper for real goods from all around the world. Very few understand the full implications of a floating currency system. Modern monetary theory has been invented to describe the workings of the system but in the economics textbooks they only teach conventional monetary theory which is based on the assumption that money is gold. The better dollar is the key to the US hegemony and power in the world. US gets to spend as much money as it likes because it only needs to print money while the other countries must have dollar backing for their currencies at least until recently. For a number of reasons US power has declined recently and the emerging power centers have attempted to create alternatives to this dollar based system because everyone realizes the enormous advantages that the US ہر own having dollar denominated trade. Today just as in 1944 a symmetric trading system which gives equal power to all of the trading partners is needed but this is not likely to emerge. Instead what we are likely to see is a multi polar system where all of the powerful countries balance اپنی پارے کے between themselves without giving due fair trades to the weaker countries.