History and chronology of changes of the world monetary system

Abstract

The world monetary system has undergone changes based on the needs and economic demands of the time. The state of panic is a situation of desperation which is the main cause of changes in the world monetary system. Questions arise here: What are the panic situations causing these changes and whether the global economic crisis today is the panic situation that permits the world to change to gold system? Hence, the purpose of this study is to analyze the history of the development of world monetary system and to identify the chronological chain of currency changes as well as to detect the panic situations that are causing changes in the system. This is a qualitative study going by the strategic approach of historical studies and library research. The results revealed that the chronological changes in the monetary system occurred intermittently between gold and paper money system (float) due to several situations referred to as panic situations. The panic situations identified were the war, the world recession and the problem of excessive inflation and deflation. Therefore, it is not possible if a panic situation occurs in dealing with global economic crisis today prompting for a switch in the currency system today to return to gold standard system. © Medwell Journals, 2012.