Compared with the OP and much of this thread, there is a simpler view: Here I outline Asset Bubbles, Fractional Reserve Banking, and the Money Supply 101: In

Compared with the OP and much of this thread, there is a simpler view: Here I outline Asset Bubbles, Fractional Reserve Banking, and the Money Supply 101: In the 1920s, the US blew a stock market bubble. Lots of people bought stocks on margin, that is, with loans from commercial banks and using the stock as collateral. The banks got the money not from "the Gold Standard" with so much attention in the OP but from fractional reserve banking, that is, loaning out deposits of savers, demand deposits. Due to the crash of the stock market, suddenly at the end of Black Tuesday, 10/29/1929, lots of the loans could not be paid back. The borrowers were broke. Then the banks were broke. Then savers were broke. Much of the money supply had been from the loans from the fractional reserve banking, and with the stock market crash that money had in effect been destroyed. So, we suddenly had a huge reduction in the money supply. The people who suddenly were broke weren't spending much money, and, thus, their vendors had reduced revenue and fired their workers who then weren't spending much money, and we were in the Great Depression. The source of the bubble was fractional reserve banking, not really, directly the Gold Standard: With or without a Gold Standard, we can still use fractional reserve banking to blow asset bubbles that can pop and destroy much of the money supply -- we came close for the same song, second verse with the mortgage bond crash in 2008. So, after 10/29/1929 the US was buying less and, thus, England, Germany, etc. were selling less and also went into a Great Depression. Then also the US was not selling as much to England, Germany, etc. and went into a deeper Great Depression. On 12/7/1941, Japan attacked Pearl Harbor and, thus, got the US into WWII. As a result, using borrowed money, War Bonds, the US started massive war production so that everyone who was willing and able to work had 1-3 jobs. Then 90 days later, say, 3/7/1942, over 12 years since the stock market crash of Black Tuesday, 10/29/1929, we were out of the Great Depression. Slam, bam, thank you, Ma'am, in 90 days we were out of what we had been in for 12+ years since 10/29/1929. Yes, we can suspect that with some real understanding of the economy we COULD have been out of the Great Depression in 90 days after, Black Tuesday, 10/29/1929, that is, on about 1/29/1930. The 12+ years in the Great Depression caused lots of serious harm just here in the US, some of which is still with us. For the world, one could argue that the Great Depression was the main cause of WWII that killed 50 million, maybe 100 million, people. Fumbling with the real causes of the Great Depression seems, say, unfortunate. The War Bonds in effect increased the money supply, and at the end of the war we stayed out of the Great Depression. Yes, we can control fractional reserve banking via reserve ratios, stress tests, etc. Lesson: Yes, sound money is important. What to do with gold as money is also important. But the key failure that caused the Great Depression was the pop of an asset bubble puffed up with borrowed money from irresponsible cases of fractional reserve banking while this and that about gold was essentially irrelevant. Simple, 101 level stuff.