Finance and Profits: The Changing Nature of American Business Cycles

Abstract

The Federal Reserve was to stabilize the economy by preventing debt-deflations, not by controlling the monetary supply. Monetarist theory holds that the rate of growth of money income is determined by the growth of money, and that the Federal Reserve can control the money supply to achieve noninflationary economic growth. The Federal Reserve Bank of New York opened its discount window to the Franklin National, which allowed it to pay off maturing liabilities. Today's American economy is much different from the economy that collapsed in the Great Depression some fifty years ago. The Roosevelt reforms took place in an intellectual vacuum that followed the failure of the then standard economic theory, and thus the inability of the day's leading economists to understand American capitalism and to develop effective programs for controlling and reversing the great contraction. Beginning with the National Recovery Act (NRA), the Roosevelt administration followed soft anti-trust policies; this softness was interrupted for a brief period in 1937-38.

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 25 citations exist upstream.