FDR confiscated the largest free circulating stock of gold coin in world history, and just as important, reneged on all outstanding gold bonds and gold contracts.
Given the passage of time and hindsight, it was an incredible thing to do, not only from a constitutional perspective, but a pure power grab by the federal government. And given the complete nonsense in recent years it starts to make sense.
The gold owned by the Treasury even at market price wouldn’t have paid for the TARP, or maybe a month or so of gov’t operations. Don’t misunderstand - it’s a lot of money - say, 252 million ounces @1400 is roughly 350 billions.
Of course even this assumes that the gold, that has not been audited since Eisenhower was President, is still there, or has not been pledged, swapped, leased or sold, etc.
Next, a gold standard would require that a price peg be high enough to entice dollar holders to keep their dollars versus redeem them for gold.
Problem - the US doesn’t have enough gold, which brings us right back to the reason gold was severed from the monetary system to begin with.
FDR’s rationale for confiscating gold was in order to reprice it and thereby increase the money supply by a full third.
A new gold standard would simply have to restore convertibility, just as was done in 1876 after Lincoln had suspended convertibility in 1862. The conversion price could be the current spot price.
“the US doesn’t have enough gold,”
The US “didn’t have enough gold” at any time that it was on the gold standard. When there is a gold standard actual demand for specie drops.
For all we know, the Red Chinese could be holding it as part of the collateral for all the money that they have loaned us.