A Quote by Ludwig von Mises

Depression is the aftermath of credit expansion.

Ludwig von Mises

Quote Topics

Aftermath Credit Depression Expansion

Quote Author

Ludwig von Mises
Austrian - Economist
September 29, 1881 - October 10, 1973

To combat depression by a forced credit expansion is to attempt to cure the evil by the very means which brought it about; because we are suffering from a misdirection of production, we want to create further misdirection -- a procedure which can only lead to a much more severe crisis as soon as the credit expansion comes to an end.

Friedrich August von Hayek

To combat the depression by a forced credit expansion is to attempt to cure the evil by the very means which brought it about.

Friedrich August von Hayek

Credit expansion can bring about a temporary boom. But such a fictitious prosperity must end in a general depression of trade, a slump.

Ludwig von Mises

Government policies try to prevent the emergence of serious unemployment by credit expansion, i.e., inflation. The outcome was rising prices, renewed demands for higher wages and reiterated credit expansion; in short, protracted inflation.

Ludwig von Mises

One day, because they realize for some reason or other that they must stop credit expansion, the banks do stop creating new credit to lend. Then the firms that have expanded cannot get credit to pay for the factors of production necessary for the completion of the investment projects which they have already committed themselves. Because they cannot pay their bills, they sell off their inventories cheap. Then comes the panic, the breakdown. And the depression starts.

Ludwig von Mises

There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.

Ludwig von Mises

What is needed for a sound expansion of production is additional capital goods, not money or fiduciary media. The credit expansion is built on the sands of banknotes and deposits. It must collapse.

Ludwig von Mises

True, governments can reduce the rate of interest in the short run. They can issue additional paper money. They can open the way to credit expansion by the banks. They can thus create an artificial boom and the appearance of prosperity. But such a boom is bound to collapse soon or late and to bring about a depression.

Ludwig von Mises

Since the eighteenth century the immense expansion of the worlds wealth has come about as a result of a correspondingly immense expansion of credit, which in turn has demanded increasingly stupendous suspensions of disbelief.

Lewis H. Lapham

You can get a lot done when you don't care about credit. My name was not on Medicaid expansion, but it never would have happened without the work that I did. The best leaders are the ones that want results, not credit.

Gretchen Whitmer

Sometimes I wonder how much of these debates have to do with the desire, the legitimate desire, for that history to be recognized. Because there is a psychic power to the recognition that is not satisfied with a universal program, it's not satisfied by the Affordable Care Act, or an expansion of Pell grants, or an expansion of the earned-income tax credit.

Barack Obama

The Panic of 1819 exerted a profound effect on American economic thought. As the first great financial depression, similar to a modern expansion-depression pattern, the panic heightened interest in economic problems, and particularly those problems related to the causes and cures of depressed conditions.