Final answer:
President Nixon's decision to abandon the gold standard in 1971 and close the gold window had a significant impact on the value of the dollar, international trade, and the U.S. economy.
Step-by-step explanation:
President Nixon responded in dramatic fashion by abandoning the gold standard in 1971. This decision allowed the United States more flexibility to respond to the financial crisis but also furthered the impression that the nation was on the decline. The abandonment of the gold standard marked the beginning of the end of the dollar's dominance in international trade.
Additionally, the closing of the gold window by Nixon resulted in a devaluation of the dollar, making American goods cheaper abroad and stimulating exports. This move was a response to the fact that foreign dollar holdings had exceeded U.S. gold reserves in 1971.
The timing of war, dollar printing, and Nixon closing the gold window is interconnected. The postwar industrial development in Asia and Western Europe led to serious competition for American businesses. The increased appetite for imports left foreign central banks with billions of U.S. currency fixed to gold, causing a devaluation of the dollar when foreign dollar holdings exceeded U.S. gold reserves.