Eugene Fama once countered Freidman by pointing out the fact that (according to Friedman's data) the US banks had massive free reserves during the great depress

Eugene Fama once countered Freidman by pointing out the fact that (according to Friedman's data) the US banks had massive free reserves during the great depression, but they were not making loans, thus it is not clear that the Federal Reserve had anything to do with the deflation (or could have done anything about it). According to Fama (as the conversation was in private), Friedman neither refuted the argument, nor did he admit he was wrong.[1] [1] http://www.econtalk.org/archives/2012/01/fama_on_finance.html http://www.econtalk.org/archives/2012/01/fama_on_finance.htm...