Every monetary standard has its perceived drawbacks, even the gold standard. From Charles Hugh Smith at oftwominds.com:
Even currencies maintaining convertibility to gold are still subject to bond yields, interest rates, trade and capital flows.
It’s widely held that all of our financial woes are the result of abandoning the discipline of the gold standard in 1971. The premise here is that if the U.S. had maintained the gold standard, the excesses of the fiat currencies regime could not have arisen.
The real story is the U.S. was hemorrhaging gold in the 1960s at such a rate that America’s entire gold reserves would have disappeared by 1976 – 1978. Other nations converted their dollars into gold at a furious pace, draining America’s gold reserves. Once your gold is gone, you can’t have a gold standard. (see chart below.)
The point here is the U.S. was only a few years away from going off the gold standard anyway. President Nixon ended the convertibility of the U.S. dollar to gold (a.k.a. “closed the gold convertibility window”) i.e. abandoned the gold standard, to preserve the remaining reserves, officially listed as around 8,100 tons.
The real story is complex. It has a lot of moving parts that are critical to understanding the gold standard and fiat currencies. A good starting place is this essay from the Federal Reserve Bank of St. Louis: The Changing Relationship between Trade and America’s Gold Reserves.