It is easily seen that all money in the whole world is not covered by all gold in the whole world.
That's the reason we moved to a dollar standard and floating currency rate i.e. the world trades in reserve currencies (of which the dollar is the most predominant) and golds price changes with respect to the dollar rather than being fixed. Nixon decoupled the dollar from gold in the early 1970's in order to pay down the cost of the Vietnam war, resulting in golds price subsequently rising as the dollar printing press started to roll. More recent rises in golds price reflects how the printing presses have been hard at work again.
The problem as I see it is that the US can export its inflation by printing more money. Naturally others aren't comfortable with that and are seeking out alternatives. As you need a single strong entity to take on that role the Euro was formed and is slowly being migrated towards. Based on the data shown in http://en.wikipedia.org/wiki/Reserve_currency the trend towards the dollar losing its primary reserve currency position could occur as early as 2017, perhaps even earlier should the trend hasten as potentially it could.
Equally however the trend could falter (PIIGS etc.). As that BBC article notes in its closure its a complex matter.
China seems to be hedging its bets and building up large reserves both in gold and currencies such that whatever is likely agreed upon ultimately they'll be sitting relatively pretty. My guess is that they'll be a transition to three main reserves, one each in America, Euro and Asia with each being held in around equal amounts as reserve/trade currencies. Perhaps those reserve currencies might be recoupled back to gold - who knows.
As I begin to understand more about how unreal fiat currency can be, I am putting more faith in tangibles such as gold, oil, etc. Yesterday, I was looking at the Gold to Oil Ratio.
Compared to Oil, Gold is relatively cheap. Have a look at the following chart:
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