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>the American industrial revolution happened during a period without central banks and their "flexibility. Before the great depression and the federal reserve,

>the American industrial revolution happened during a period without central banks and their "flexibility. Before the great depression and the federal reserve, weren't there financial crises/panics over and over? I'm not real familiar with 19th century history, but obviously there was a reason we set up all those institutions and laws in the 30s, because the way things worked had become untenable. Edit: "Between 1863 and 1913, eight banking panics occurred in the money center of Manhattan. The panics in 1884, 1890, 1899, 1901, and 1908 were confined to New York and nearby cities and states. The panics in 1873, 1893, and 1907 spread throughout the nation. Regional panics also struck the midwestern states of Illinois, Minnesota, and Wisconsin in 1896; the mid-Atlantic states of Pennsylvania and Maryland in 1903; and Chicago in 1905." https://www.federalreservehistory.org/essays/banking-panics-of-the-gilded-age https://www.federalreservehistory.org/essays/banking-panics-...

perl4ever 6y ago
"The Panic of 1873 was blamed for setting off the economic depression that lasted from 1873 to 1879. This period was called the Great Depression, until the even greater depression of 1893 received that label, which it held until the even greater contraction in the 1930s -- now known as the Great Depression."
abernard1 6y ago
> Before the great depression and the federal reserve, weren't there financial crises/panics over and over? They were tiny, and they were mild by comparison. Even with the Fed, not exercising "flexibility" has been a better option. In 1920, the Dow dropped 47%, deflation hit with prices dropping 20%, wholesale prices dropped 37%, and unemployment went over 10%. Neither the Federal Reserve nor the federal government did anything. You have never heard of this intense deflationary depression because it didn't last for 11 years. It lasted for 18 months. Edit: > but obviously there was a reason we set up all those institutions and laws in the 30s, because the way things worked had become untenable. There does not. Poorly run institutions are a staple of the Modern Era. The reason the Fed was set up was because it aligned with the philosophy of central control within the progressive movement. Until Wilson, no presidency had ever been called an "administration." (For an unbelievably sad look at that former president, look at his favorite book called Philip Dru: Administrator.)
- perl4ever 6y ago
  >They were tiny, and they were mild by comparison. As I quoted in my other comment, there was a "great depression" and then another, and then the third, which is what we now know by that name. That seems to be the establishment view of history.

perl4ever 6y ago

"The Panic of 1873 was blamed for setting off the economic depression that lasted from 1873 to 1879. This period was called the Great Depression, until the even greater depression of 1893 received that label, which it held until the even greater contraction in the 1930s -- now known as the Great Depression."

abernard1 6y ago

> Before the great depression and the federal reserve, weren't there financial crises/panics over and over? They were tiny, and they were mild by comparison. Even with the Fed, not exercising "flexibility" has been a better option. In 1920, the Dow dropped 47%, deflation hit with prices dropping 20%, wholesale prices dropped 37%, and unemployment went over 10%. Neither the Federal Reserve nor the federal government did anything. You have never heard of this intense deflationary depression because it didn't last for 11 years. It lasted for 18 months. Edit: > but obviously there was a reason we set up all those institutions and laws in the 30s, because the way things worked had become untenable. There does not. Poorly run institutions are a staple of the Modern Era. The reason the Fed was set up was because it aligned with the philosophy of central control within the progressive movement. Until Wilson, no presidency had ever been called an "administration." (For an unbelievably sad look at that former president, look at his favorite book called Philip Dru: Administrator.)

perl4ever 6y ago
>They were tiny, and they were mild by comparison. As I quoted in my other comment, there was a "great depression" and then another, and then the third, which is what we now know by that name. That seems to be the establishment view of history.