A Monetary History Of The United States, 1867-1960 Today

The authors argued that the Depression was not a "market failure" but a "government failure." They blamed the Federal Reserve for allowing the money supply to shrink by one-third between 1929 and 1933.

The book contends that had the Fed maintained a steady money supply, the severe contraction could have been avoided or significantly mitigated. Key Historical Episodes Analyzed The book covers several distinct monetary eras:

They identified four critical errors, including raising interest rates in 1931 to defend the gold standard and failing to act as a "lender of last resort" to stop banking panics. A Monetary History of the United States, 1867-1960

The book's most famous section, Chapter 7 (often published separately as The Great Contraction ), reinterpreted the Great Depression.

Populist efforts for bimetallism and the deflationary pressures of the late 19th century. The authors argued that the Depression was not

Before this book, the prevailing Keynesian consensus held that monetary policy was largely ineffective, especially during deep downturns. Friedman and Schwartz challenged this by demonstrating that:

The aftermath of the Civil War and the return to the gold standard. The book's most famous section, Chapter 7 (often

They utilized a "narrative approach," analyzing nearly a century of historical data to show that changes in money often preceded changes in economic activity, rather than just reacting to them. "The Great Contraction": A New History of the Depression