But at the same time Europe has been growing stronger industrially and economically. European nations are making more of their own products rather than buying them from the U.S. Further, more and more goods are sold to the U.S.

The Floating Dollar

The United States agreed with thirteen major non-Communist countries no longer to have a fixed currency exchange rate. Rather, dollar rates would henceforth float, that is, find their own value in each nation as determined by supply and demand.

At least six European nations agreed to a “joint float.” They established a fixed rate of exchange among themselves but floated as a bloc against the U.S. dollar.