1970s financial crisis

Great question.  I like Robert Schaeffer's chapters (Understanding
Globalization) on the 1970s.  Chapter three talks about Nixon's devaluation
of the dollar in 1971 by abandoning fixed exchange rates. He mentions the
below true (market) value exchange rate set for the dollar with respect to
the yen after WWII in order to help the Japanese economy. However, he
argues that by 1971 Japan and the other first world countries had become
more competitive compared to U.S. producers, so that by 1971, there was a
trade imbalance. Also the Vietnam War spending was contributing to
inflation.  By the late 1960s due to U.S. financial aid (Marshall Plan),
spending on NATO (which sent dollars abroad), and the Vietnam War, too many
dollars were circulating in the world market -- undermining the value of
the dollar. That the world economy needed the US to pump money in (global
Keynesianism?) but in so doing this undermined the value of the US dollar
(all this according to mainstream economic thinking) was known as the
Trifflin Dilemma when it was seen to undermine the dollar as global
monetary standard.  The Trifflin book (Gold and the Dollar Crisis) came out
in 1960! I think this analysis is one place to begin. I bet Andre Gunder
Frank has written about this as well. 

Could you please forward to me any other answers you receive.

Best,
Roz

At 10:05 PM 5/6/00 -0400, you wrote:
>
>Can somebody exactly trace the origins of the global economic crisis of
>the 1970s? i don't mean the oil crisis (73-74).I mean the dollar crash
>(financial crisis) that involved speculative bubbles and panics. Whatever
>I have read so far (Gourevitch, Wolfson, Kindleberger, Arrighi) does not
>state a clear year. Economic historians always speak in broader terms. I
>am a history maniac person, and I need to figure out this. Wolsfon talks
>about the 1970 bankruptcy of the Penn Central Railroad as well as the
>failure of Franklin National in 1974 in his study of the post-war US
>experience. Do these correspond to the global economic crisis of the
>1970s? I think these collapses are the domestic consequences of
>international crisis. what is the exact year for this (world financial
>crisis)? 1971?
>
>Please, help!
>
>best wishes,
>
>Mine Doyran
>Phd Student
>Political Science
>SUNY/Albany
>
>
>