The IMF and the World Bank were originally established in 1944 at the Bretton Woods conference between allied forces (essentially the US and Britain). It was a response to a wide range of international economic problems in relation to global trade that were experienced at the time and in the preceding decades. The most notable examples of such difficulties were exchange rate instability, ‘hot’ money flowing in and out of nations unpredictably, and the lack of a mechanism to adjust the balance of payments problems of countries, post-World War II debt and the need for the reconstruction and development of economies across the globe.
The IMF was designed to put in place a stable exchange rates regime with some scope for revaluation and convertibility of currencies when required. Short-term liquidity crises were to be managed by lending money to nations that experienced a temporary balance of payments crisis or by providing some form of orderly devaluation of the affected nation’s currency in times of more persistent BOP problems. It was hoped that these two latter processes would allow nations to reduce their deficits without resorting to protectionism or by experiencing deflation.
The International Bank for Reconstruction and Development (the World Bank) had the purpose of financing projects and infrastructure development in the war-torn European nations as well as to assist the industrialisation of post-colonial societies.
Under Bretton Woods the US dollar became the global reserve currency. This meant, amongst other things, that while every other national currency could devalue against the dollar, the US dollar could be devalued only against gold.
John Maynard Keynes and other negotiators at Bretton Woods had originally advocated a global reserve currency that was not, in fact, to be linked to any particular national currency. But the US held the hegemonic power at the time of these negotiations and its leaders designed the system to serve their priorities . They wanted an up-dated gold standard to facilitate the liberalization of global trade and they wanted financial power concentrated in Washington and New York. US ‘negotiators’ won the day and lost the cause by doing so.
Because of the economic asymmetry between he United States and the rest of the world it soon began to experience a persistent balance of payments deficit. This situation arose under Bretton Woods because without the persistent US capital outflows the world experienced (for a number of reasons) a liquidity shortage. “In the early postwar years, the capital outflow consisted largely of foreign aid. By the end of the 1950s, private long-term investment abroad (mainly direct investment) exceeded military expenditures abroad and other official transfers (Eichengreen 199 1).” 
That Bretton Woods system crumbled after 1968 and ended with the closing by President Richard Nixon of the gold window on 15 August 1971. Prior to that at least one US presidential administration had used the nation’s economic hegemony to intervene and disrupt the operations of the Bretton Woods institutions. 
By the early 1970s the free market had become largely a historical relic in any case. “It [had] been transformed by three systemic forces over the [previous] 40 years: accelerating concentration of industry and banking, increasing intervention of government into the “private sector”, and…the spectacular rise of the intracorporate (nonmarket) economy of the global oligopolies.”
For more on the background and history of the Bretton Woods system see: The Bretton International Monetary System: A Historical Overview, by Michael D. Bordo.
END OF PART ONE
 Keynes’ Achilles’ heel was his lack of political sense, according to his biographer Robert Skidelsky. “He never studied the sources of power nor how society is affected by social stratification or the forces of social control.’. Page 494 ‘John Maynard Keynes, Fighting for Freedom, 1937 – 1946’ by Robert Skidelsky.
 The Bretton International Monetary System: A Historical Overview, by Michael D. Bordo, professor of economics at Rutgers University.
 Documents show that the Nixon administration engaged in an invisible economic blockade against the Allende government in Chile, intervening at the World Bank, IDB, and Export-Import bank to curtail or terminate credits and loans to Chile before Allende had been in office for a month. See: Department of State, Memorandum for Henry Kissinger on Chile, December 4, 1970:
 ‘Global Reach – The Power of the Multinational Corporations’ by Richard J Barnet & Ronald E Muller. Simon and Schuster1974. SBN 671-22104-3 Paperback.