Michael Klein via The Conversation | Going back to a gold standard would create new problems. For example, the price of gold moves around a lot. A year ago an ounce of gold cost $1,457. The pandemic helped drive up the price by 40% to $2,049 in August. As of Nov. 18, it was about $1,885. Clearly, it would be destabilizing if the dollar were pegged to gold when its prices swings wildly. Exchange rates between major currencies are typically much more stable.
Price of Gold
Let us talk about the relation between the US dollar price of gold and the quantity of US dollar. In fact, one would think that it is, economically speaking, a rather straightforward relationship: All you need is to compare the supply of physical gold and the quantity of US dollar.