One of their last sentences is intriguing, but unfinished:
“Putting an end to inflation requires not only the abolition of the Fed but also the abolition of the FDIC and FSLIC. At long last, banks would be treated like any firm in any other industry.”
The the question becomes, “and then what happens?”
I think I have an answer for that, based on how Weimar Germany (with advice from the US), got out from its horrible hyperinflation of its fiat currency, the Papiermark.
The first thing they did was to create a new, gold backed, “bank and government currency”, that did not circulate, but because it was very stable, did not inflate either. It was called the Rentenmark, as normalized the German economy, while erasing “bubble debts” and taking possession of forfeited assets.
It got the Papiermark back under control, at least enough so that when a third currency, a circulating currency, also gold backed, the Reichsmark, was introduced, it was also very stable. So stable that it even survived World War II.
Unfortunately, there is not enough gold (and silver, combined) in the world today to back a major currency. But this problem can be alleviated by including other non-renewable commodities: aluminum, copper, iron, other metals and mined chemicals, and even processed steel.
The US most certainly could create a “bank and government”, non-circulating currency, that officially would be “specie backed”, but unofficially would be “specie plus”.
You were on a roll till that statement.
Any amount of gold will serve to back a currency. If the dollar were defined as 1/4 of 1 grain of gold (1/1920 of a troy ounce) and dollar-holders could redeem their dollars at will for that amount; it would suffice to back the currency.
As long as banks are required to part with their gold reserves upon demand of the depositor, they will be careful not to over-extend themselves. Increasing redemption of gold serves as a signal to a bank that customers are losing confidence and the situation should be corrected: loans called in, interest rates on deposits increased, etc..
Redemption is the key to a successful gold standard. The amount of backing must be defined, but the quantity doesn't matter.