The price of gold rose 10% in 2011, while the Amex Gold Bugs Index (NYSE: HUI), a basket of unhedged gold stocks, fell 16%.

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The value of the dollar should be stabilized against gold or a basket of commodities (the 21-commodities-based system used in the 1990s by Fed Vice Chairman Wayne Angell would work).

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Monetary policy would then be guided by the market prices of a basket of inflation sensitive precious commodities such as gold.

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This would be a global currency explicitly backed by a basket of a dozen or so precious commodities, such as gold, silver, oil, etc.

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