In your scenario, they didn't save ENOUGH capital to see purchasing power return? Investment is about belief. If I bet you a plastic button that my company will have record profits, you might think that I have no conviction in that belief. If I bet my irreproducible money that is a strong belief. Right now wall street is rake betting, malinvesting, and basically scatter shooting money all over the market. This makes the signal of what industry is thriving nearly impossible to determine. (See AI, most investment, least return) With something VALUABLE on the line people make things happen where a lack of conviction otherwise would not. This is the benefit. As far as Gold, yes since people conflate the dollar with gold the inflation they see in the dollar is percieved as "good." If gold was fixed that inflation signal would be way more obvious to everyone. Like I said slow inflation still distorts true economic signals. It doesn't break things it is just worse.

most of the arguments against the inflationary nature of the gold standard depended on the arbitrary inflation rate as gold is mined. obviously those aren't a consideration here. I'd like to see a good argument for how a *fixed inflation rate that approaches zero* causes any appreciable distortion. and about investment, this is just the same " people will spend money to not die " argument. you don't need a hard cap for that and there's no good argument for setting the bar as high as possible. we need economic stability, not to make investment as difficult as we possibly can.