Cornerstone Worldwide sources say the Asian-based wealth management firm is largely in agreement with assertions that the world should return to the discipline of the original Bretton-Woods agreement.
The original Bretton Woods agreement, fixed exchange rates, established the International Monetary Fund and began the process of rebuilding Europe's economy in the aftermath of World War II by encouraging coordinated economic policies. It eventually failed when the US abandoned the gold standard to combat inflation arising from, among other things, its futile efforts in the Vietnam War.
Jean-Claude Trichet, President of the European Central Bank, suggested that a return to the discipline of Bretton Woods would restore badly-needed credibility to the global financial system, turmoil in which recently culminated in dramatic asset price deflation in equity markets around the world.
Cornerstone Worldwide believe that the implementation of a gold standard to back currencies would curb the tendency of governments to simply print money as when they saw fit.
One of the Cornerstone Worldwide sources suggested that although the US would more than likely oppose such a move, the sheer scale of the transference of wealth from Western economies to those in the East would see less weight being given to their opinion.
