From Wiki:
"On December 17 and 18, 1971, the Group of Ten, meeting in the Smithsonian Institution in Washington, created the Smithsonian Agreement, which devalued the dollar to $38/ounce, with 2.25% trading bands, and attempted to balance the world financial system using SDRs alone. It was criticized at the time, and was by design a "temporary" agreement. It failed to impose discipline on the U.S. government, and with no other credibility mechanism in place, the pressure against the dollar in gold continued.

This resulted in gold becoming a floating asset, and in 1971 it reached $44.20/ounce, in 1972 $70.30/ounce and still climbing. By 1972, currencies began abandoning even this devalued peg against the dollar, though it took a decade for all of the industrialized nations to do so. In February 1973 the Bretton Woods currency exchange markets closed, after a last-gasp devaluation of the dollar to $44/ounce, and reopened in March in a floating currency regime."

Duy continues:
"Bad things happen when you fight the Fed. You find yourself on the wrong side of a whole bunch of trades. In this case, I suspect it means that Bretton Woods 2 finally collapses in a disorderly mess. There may really be no other way for it to end, because its end yields clear winners and losers. And the losers, in this case largely emerging markets, and not prepared to accept their fate."

Bad things you might say are already underway, and is already threatening to become disorderly. Recent spikes in commodity prices and foreign currencies are an indication. The Swiss and the Aussie dollar set record highs last week, the Yen is positioned to set record highs itself in the weeks ahead despite BOJ interventions.
Gold has been making record new highs almost on a daily basis since finding a floor on July 29 2010. Other commodities have begun to take flight as well. Grains and cotton were limit up on Friday, in response to the USDA supply demand report. Corn, beans and cotton were roughly limit up on Sunday night as well. Corn has risen 15% in less than 2 sessions and Soybeans 10%.

Funny thing about that limit up day in soybeans on Friday however, The USDA confirmed soybeans would achieve a record harvest (albeit 2% below last months record harvest forecast). Think about that for a moment. Why would soybeans go limit up on confirmatory news of a record harvest? Might something be afoul and distorting the soybean and other commodity mkts? Yves Smith and many other mkt participants raised this very question two years ago in the following posts:

http://www.nakedcapitalism.com/2010/10/summer-rerun-is-the-commodities-boom-driven-by-speculation.html
http://www.nakedcapitalism.com/2008/04/commodity-volatility-creates-problems.html

These articles attribute much of the increased volatility in the commodity mkts to the recent securitization of the commodity mkts, made possible by the commodity modernization act of 2000 to circumvent the regulatory framework, limits and oversight of the CFTC.

Some quoteworthy highlights from these Naked Capitalism articles:
Rising prices and a widespread bull market in commodities should indicate that there is a growing scarcity of hard assets. However, traditional forces of supply and demand cannot fully account for recent prices.
To be precise, the normal price-inventory relationship has been altered. This is the assertion of an expanding list of bona fide hedgers, commodity professionals and economists.