This is wrong in every possible important way. Not least is the idea of confusing the Gold Window it’s the Gold Standard (gold backing currency in any way).
The worldwide gold standards (in any form, or even silver backed) were dead by WW1.
There’s no implicit backing of the dollar since then, at all, and convertibility was a (really terrible) relic of that period.
> Not least is the idea of confusing the Gold Window it’s the Gold Standard (gold backing currency in any way).
There's not a confusion between the Gold Window and the Gold Standard. It's just the Gold Window is the only real bottom line. There can be different types of gold standards, and some of them are abstractions of the Gold Window. The Gold Window is not abstract, it is an exchange of paper for gold.
> The worldwide gold standards (in any form, or even silver backed) were dead by WW1.
They were dead and what happened to Germany's currency? The Papiermark fell into complete worthlessness.
> There’s no implicit backing of the dollar since then, at all, and convertibility was a (really terrible) relic of that period.
If it was a "relic" it was something that existed because it needed to exist.
As I said in another post, I don't think gold has a magical commodity. It is a commodity which has good qualities for a currency, or backing a currency - it is uniform, divisible, durable, portable etc. An announcement that the gold window was open again would quickly stem any currency panic and would give government officials time to deal with it. There is no magic in a gold commodity, silver would work as well, as would platinum, as would any commodity (although the more currency properties the commodity had the better).
If there's no implicit backing of the dollar, then why does the US government, at great expense, store thousands of tons of gold at Fort Knox and elsewhere?
Why did Germany start repatriating hundreds of tons of gold from overseas five years ago if these gold reserves mean nothing? What are they for other than as an implicit backing of currency?
I know the US government would like to have a magic printing press that printed out hundred dollar bills and had them be worth something without any connection to anything. But things don't work like that.
Why did the price exchange of a Papiermark collapse after World War I if convertibility has no relevance to paper currencies?
The worldwide gold standards (in any form, or even silver backed) were dead by WW1.
There’s no implicit backing of the dollar since then, at all, and convertibility was a (really terrible) relic of that period.