Mundel grew up and went to grad school while the USA was on either the gold standard or the Bretton Woods 'dollar' standard with the dollar pegged to gold. It was the emanence of major gold flows in 1971 that compelled Nixon to 'close the gold window' and stop the exchange of dollars for gold. Mundel had proposed raising the peg to $45/oz to Nixon during a long plane flight during the '68 presidential campaign, but Nixon was too distracted to listen. Even so, raising the peg for gold would have been a hard sell. The very idea makes most 'gold bug's' heads explode. To them it undercuts the very point of a gold standard while appealing to the 'common sense' of a majority of the electorate.

"It is not necessary to have hope in order to persevere."