[A-List] Financial terminology clarification (please)

["Xxxx Xxxxxx" <xxxx.xxxxxx@xxxxxxxxxxx>]

Hi all.. Can somebody explain to me (in simple terms) what a "swap
agreement" is and how it was related to the operation of gold exchange
standard  (under Bretton Woods)?

OR translate this longgggg sentence into simple English?

In 1962  "The Federal Reserve entered into a network of swap agreements with
other central banks in order to obtain foreign currencies for short-term
periods for use in absorbing forward sales of dollars by foreign central
banks hedging exchange risk on their dollar holdings"

http://www.ustreas.gov/offices/international-affairs/esf/history/index.html

Any help is greatly appreciated!

regards,

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Xxxx A. Xxxxxx
Doctoral Candidate
Department of Political Science
Nelson A. Rockefeller College of Public Affairs and Policy
University at Albany, S.U.N.Y.
135 Western Avenue, Milne Hall
Albany, NY 12222
xxxx.xxxxxx@xxxxxxxxxxx
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"They always say that time changes things, but you actually
 have to change them yourself." -- Andy Warhol
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