The most prosperous countries the world has ever known all adhered to a strict gold standard. The money was never debased and there was no fiat currency. However, in today’s society, carrying around gold coins would be impractical.
Therefore, all United States currency held by the citizens of the new country will be converted into gold or silver. Anyone who wants to convert their gold or silver into paper money printed by the new government will be free to do so. The government would be prohibited from printing any new money that was not backed 100% by gold or silver. This will result in paper money that will be backed by 100% precious metal reserves as required by the constitution. This will virtually eliminate inflation and the boom and bust business cycles.
Since the price of gold fluctuates businesses would be allowed to adjust the value of paper money based on the price of gold. For instance, if the base price of gold was $1,600 and it increased 5% to $1,680 then each dollar bill would have $1.05 in purchasing power. The merchants could make this adjustment at the register much like we currently do with foreign currency.
The Treasury would be the only agency authorized to print paper money. New paper money could only be printed to replace worn out bills or to purchase new gold or silver. Individuals would be free to mint their own gold or silver coins but they would not be legal tender.