Beyond the difficulty in transporting, storing, and preventing the debasement of gold, one of the main disadvantages of a gold standard is that it might artificially inflate gold's value, increasing the cost of items and industrial processes in which it is used. The total amount of gold that has ever been mined is estimated at about 142,000 tonnes. At a gold price of US$800 per Troy ounce, or around $26,000 per kilogram, the value of this entire planetary stock would be $3.65 trillion, which is less than the value of cash circulating. In the U.S. alone, more than $7.3 trillion is in circulation or on deposit. Under a U.S. gold standard, the price of gold would be more than proportionally higher, because all the gold in the world can not be brought in to U.S. bank vaults.
Under the gold standard, gold mined at a different rate than the economy grows can produce both inflation, when deposits are discovered and extracted, and deflation when they are mined to exhaustion. In practice, the production of gold has usually trailed economic growth, resulting in periods of deflationary pressure, including contributing to the cause of the Great Depression and events during it. During the gold rushes in California and Australia, soaring gold output contributed to a 5% yearly increase in wholesale prices during the period between 1850 and 1855.
Using a fixed commodity as a monetary standard gives central banks fewer options with which to respond to economic crises and stimulate economic growth. In particular, gold-backed currencies prevent tailoring the money supply to the economy's demand for money, and are subject to speculative attacks when the government's financial position looks weak; attacks which often require punitive economic measures to counter. Such measures exacerbated the Great Depression when the U.S. raised interest rates in the middle of a recession in order to defend the credibility of its currency. Finally, since commodity currency devaluations produce sharp changes in their values, rather than smooth declines, their effects are magnified.