Rewrite · Extraordinary measures
Abrogation of gold, currency and indexation clauses
- What it is
- Legislation voiding contractual protections such as gold clauses, foreign-currency clauses or inflation indexation in existing and future contracts, including government bonds.
- Why it counts
- Creditors, including holders of government bonds, are repaid in nominal depreciated money instead of the real value they contracted for.
When it was in force
- United States: 1933 → 1935, historical; its end is not documented
- Argentina: 2002 → now, in force
2 examples
United States
1933 → 1935HistoricalIts end is not documented · As cited: from 5 June 1933
Congress declared gold clauses void and made all obligations payable dollar for dollar in legal tender; the Supreme Court held this unconstitutional for federal bonds but denied bondholders any damages.
United States today: index 42.9Joint Resolution of 5 June 1933 (H.J.Res. 192); Perry v. United States, 294 U.S. 330 (1935)Primary source
“provides that such obligations shall be discharged by payment, dollar for dollar, in any coin or currency which at the time of payment is legal tender”
Argentina
2002 → nowIn forceProhibited adjustment (indexation) clauses in any obligation arising after the 2002 emergency law.
Argentina today: index 40.1Decreto 214/2002, art. 5 (with Ley 23.928 arts. 7 and 10 as amended by Ley 25.561)Primary source
“Las obligaciones de cualquier naturaleza u origen que se generen con posterioridad a la sanción de la Ley N° 25.561, no podrán contener ni ser alcanzadas por cláusulas de ajuste.”
Examples and their dates reviewed .