Some history you might not have read about the 30's

From What Has the Government Done to Our Money by Rothbard. Section IV.

The Classical Gold Standard, 1815–1914
We can look back upon the “classical” gold standard, the
Western world of the nineteenth and early twentieth centuries,
as the literal and metaphorical Golden Age. With the
exception of the troublesome problem of silver, the world
was on a gold standard, which meant that each national
currency (the dollar, pound, franc, etc.) was merely a name
for a certain definite weight of gold. The “dollar,” for example,
was defined as 1/20 of a gold ounce, the pound sterling
as slightly less than 1/4 of a gold ounce, and so on. This
meant that the “exchange rates” between the various
national currencies were fixed, not because they were arbitrarily
controlled by government, but in the same way that
one pound of weight is defined as being equal to sixteen
ounces.
The international gold standard meant that the benefits
of having one money medium were extended throughout
the world. One of the reasons for the growth and prosperity
of the United States has been the fact that we have enjoyed
one money throughout the large area of the country. We
86 What Has Government Done to Our Money?
have had a gold or at least a single dollar standard within
the entire country, and did not have to suffer the chaos of
each city and county issuing its own money which would
then fluctuate with respect to the moneys of all the other
cities and counties. The nineteenth century saw the benefits
of one money throughout the civilized world. One money
facilitated freedom of trade, investment, and travel throughout
that trading and monetary area, with the consequent
growth of specialization and the international division of
labor.
It must be emphasized that gold was not selected arbitrarily
by governments to be the monetary standard. Gold
had developed for many centuries on the free market as the
best money; as the commodity providing the most stable
and desirable monetary medium. Above all, the supply and
provision of gold was subject only to market forces, and not
to the arbitrary printing press of the government.
The international gold standard provided an automatic
market mechanism for checking the inflationary potential
of government. It also provided an automatic mechanism
for keeping the balance of payments of each country in
equilibrium. As the philosopher and economist David
Hume pointed out in the mid-eighteenth century, if one
nation, say France, inflates its supply of paper francs, its
prices rise; the increasing incomes in paper francs stimulate
imports from abroad, which are also spurred by the fact that
prices of imports are now relatively cheaper than prices at
home. At the same time, the higher prices at home discourage
exports abroad; the result is a deficit in the balance of
payments, which must be paid for by foreign countries
cashing in francs for gold. The gold outflow means that
France must eventually contract its inflated paper francs in
order to prevent a loss of all of its gold. If the inflation has
Murray N. Rothbard 87
taken the form of bank deposits, then the French banks
have to contract their loans and deposits in order to avoid
bankruptcy as foreigners call upon the French banks to
redeem their deposits in gold. The contraction lowers
prices at home, and generates an export surplus, thereby
reversing the gold outflow, until the price levels are equalized
in France and in other countries as well.
It is true that the interventions of governments previous
to the nineteenth century weakened the speed of this market
mechanism, and allowed for a business cycle of inflation
and recession within this gold standard framework. These
interventions were particularly: the governments’ monopolizing
of the mint, legal tender laws, the creation of paper
money, and the development of inflationary banking propelled
by each of the governments. But while these interventions
slowed the adjustments of the market, these
adjustments were still in ultimate control of the situation.
So while the classical gold standard of the nineteenth century
was not perfect, and allowed for relatively minor
booms and busts, it still provided us with by far the best
monetary order the world has ever known, an order which
worked, which kept business cycles from getting out of
hand, and which enabled the development of free international
trade, exchange, and investment.

To read the rest I suggest downloading the short book above.

John