It complicates monetary policy and threatens foreign central banks with large capital losses should U.S. interest rates rise.
I think the problem comes in when the foreign central banks ask the U.S. for gold in return for the dollars.
The practice of exchanging dollars for gold (by foreign govs)was stopped in 71. Europe had been happily draining our reserve of its gold from the end of WW II until 1971. We are back up to 8000 tons in the reserve, while several European countries have been dumping, or are about to dump, gold into the market. Britain put nearly 395 tons, about half of their reserve, into the market two years ago. France plans to sell between 500 and 600 tons of the stuff over the next 5 years.
The dollar had been kept artificially high throughout the 90s, so this is the natural correction to that. The market is crying about our budget problems, and so buying Euros, all the while ignoring Europe's own massive budgetary woes. Eventually we will see a swing back the other way, especially if the Central Banks of Europe and Japan intervene to prop up the greenback.
Either way, I'm hedging my bets and putting money into metals to limit stock and bank exposure. Not too much, but just enough to balance any dollar losses.
How would that be a problem given that we have not had a convertible currency for over three decades?
They can "ask" all they want but the answer will always be "no."