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This is getting a little absurd. First, I'm specifically referring to the Feds in its tight control of the money supply during the Depression. They restricted t
by carmelo7 16y ago
This is getting a little absurd. First, I'm specifically referring to the Feds in its tight control of the money supply during the Depression. They restricted the money supply. If you have another term for what the Feds did (note the difference between the Feds and the federal government), then so be it.
Loose monetary policy during a drought is not just supported by Keynesians (who really emphasize more expansionary fiscal policy), and is definitely not a 100% Keynesian view. Monetarists, for instance, support it widely. As do other economists. Friedman supported it, as does Bernanke, Greenspan, Summers, Mankiw, et al. To claim that an expansionary monetary policy is 100% Keynesian is just absurd and distorts the positions of other economists.
- yummyfajitas 16y agoLet me repeat: I didn't dispute the existence of tight monetary policy. I disputed that the federal government tried to let the market sort it out. Also, when you said "Feds", I assumed you meant people in the Federal Government (including the Federal Reserve, but not limited to it). Typically the Federal Reserve is simply shortened to "the Fed". Lastly, if you read your own link (to the Wikipedia article on causes of the GD), you'll discover that there are many proposed explanations (including, for example, protectionism). That's it for me.