The Coronavirus crisis highlights the importance of inflation. It is the force to drive economic development. Deflation can send an economy into a long-term recession with vicious price decrease cycles. We experienced these issues during the Great Depression during the 1920s. The gold standard exacerbated the Great Depression.
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It is not the gold system that exacerbates depression, but it is the greed of the capitalists that ultimately makes banks issue fiat money on the basis of gold reserves owned by banks and the practice of interest-bearing debt that worsens great depression because money is not used as money to smooth the economy but as an asset so it is the vulnerable act of speculation.
The ideological struggle was quite interesting in the 1930s when Adam Smith's classic economic recipe was considered a failure and allowed the market to move wildly without control, the world turned to alternatives. From the ring of global capitalism, a reformer figure like J.M. Keynes offered a new idea, the Government must intervene and stimulate the economy if it does not want the condition of depression to get worse. His advice was heard by many leaders from the western world, including the US. Keynes just wants capitalism not to go bankrupt, only to undergo a slight modification. The greatness of capitalism deserves a thumbs up, crisis and capitalism like siblings. Crisis is not to aggravate and bring down capitalism instead new methods for extending the life of capitalism have emerged, as Keynes tried.
Many say that the main weakness is the limited amount of gold is even quite rare so that it can threaten a country's gold supply. As a precious metal and a non-renewable resource, limited gold reserves will be difficult to keep up with world economic growth. In addition, the value of gold is high enough to be used as a standard exchange rate and payment instrument that is valid in people's daily lives. This high value makes it difficult to service transactions that are of less value than the value of gold.
The crisis does not always lead to inflation but also deflation because the contributing factor is sluggish purchasing power so that demand does not move up. the impact of deflation is very bad and can last for a very long time. For example, Hong Kong, which experienced a period of deflation in 2002 and until now has not been able to repair the impact of the deflation. Japan, which experienced a long period of deflation since the early 1990s, is still trying to restore its economic growth.