A Quote by Milton Friedman
What happened was that for every $100 of money, by which I mean the cash that people keep in their pockets, and the deposits they have in the bank, for every $100 of money that there was in 1929, by 1933 there was only $67. The Federal Reserve allowed the quantity of money to decline by a third. While, at all times, it had the possibilities and the power of preventing that from happening.
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The stock market crashed in October 1929. But that was not the cause of what caused the Great Depression. It was, in my opinion, a very minor element of it. What happened was that from 1929 to 1933 you had a major contraction which, in my opinion, was caused primarily by the failure of the Federal Reserve System, to follow the course of action for which it was set up. It was set up to prevent exactly what happened from 1929 to 1933. But instead of preventing it, they facilitated it.
The Depression, which started in 1929 was rather mild from 1929 to 1930. And, indeed, in my opinion would have been over in 1931 at the latest had it not been that the Federal Reserve followed a policy which led to bank failures, widespread bank failures, and led to a reduction in the quantity of money.
At the base of the Fed pyramid, and therefore of the bank system's creation of "money" in the sense of deposits, is the Fed's power to print legal tender money. But the Fed tries its best not to print cash but rather to "print" or create demand deposits, checking deposits, out of thin air, since its demand deposits constitute the reserves on top of which the commercial banks can pyramid a multiple creation of bank deposits, or "checkbook money."
The Federal Reserve the privately owned U.S. central bank definitely caused The Great Depression by contracting the amount of currency in circulation by one third from 1929 to 1933.
So: if the chronic inflation undergone by Americans, and in almost every other country, is caused by the continuing creation of new money, and if in each country its governmental "Central Bank" (in the United States, the Federal Reserve) is the sole monopoly source and creator of all money, who then is responsible for the blight of inflation? Who except the very institution that is solely empowered to create money, that is, the Fed (and the Bank of England, and the Bank of Italy, and other central banks) itself?
The Fed was largely responsible for converting what might have been a garden-variety recession, although perhaps a fairly severe one, into a major catastrophe. Instead of using its powers to offset the depression, it presided over a decline in the quantity of money by one-third from 1929 to 1933 ... Far from the depression being a failure of the free-enterprise system, it was a tragic failure of government.
Under the old system - which is now so archaic that a lot of people can't remember it - if you wanted money you had to go to the bank and take the money out in cash form, and you couldn't take out money that you didn't have. But with the credit card you can spend money you don't have, and that is just so tempting.
No central banker would disagree with the proposition that inflation is primarily a monetary phenomenon. Not one of them will disagree that every inflation has been accompanied by a rapid increase in the quantity of money and every deflation by a decline in the quantity of money.
Throughout history, every government that's printed money, the money has eventually gone to its ultimate value which is zero. Remember? The confederate dollar went to zero. The continental went to zero. That's what happens when you have a bank that's allowed to print as much money as it wants to.
Then came the second Amsterdam discovery, although the principle was known elsewhere. Bank deposits...did not need to be left idly in the bank. They could be lent. The bank then got interest. The borrower then had a deposit that he could spend. But the original deposit still stood to the credit of the original depositor. That too could be spent. Money, spendable money, had been created. Let no one rub his or her eyes. It's still being done-every day. The creation of money by a bank is as simple as this, so simple, I've often said, that the mind is slightly repelled.
The depression was the calculated 'shearing' of the public by the World Money powers, triggered by the planned sudden shortage of supply of call money in the New York money market....The One World Government leaders and their ever close bankers have now acquired full control of the money and credit machinery of the U.S. via the creation of the privately owned Federal Reserve Bank.
Repeal the entire Banking Act of 1933, and Austrian School economists will cheer, especially if the current system were replaced by a 100%-reserve competitive banking with no central bank. That banking reform would give us a sound money system, meaning no more business cycle, bailouts, or inflation.
For me, money is to use - it's only to use. So I never have money because I always spend. That's why in a way I protect myself in having houses. But if I had just cash or kept it in the bank, I'd spend it immediately. But not for stupid things. So I don't like to have money. I never have money in my pocket.
To walk in money through the night crowd, protected by money, lulled by money, dulled by money, the crowd itself a money, the breath money, no least single object anywhere that is not money. Money, money everywhere and still not enough! And then no money, or a little money, or less money, or more money but money always money. and if you have money, or you don't have money, it is the money that counts, and money makes money, but what makes money make money?
[Donald Trump] borrows money from all kinds of people around the world, including more than $100 million from a German bank now under federal investigation.
Contrary to what most people think, bank money is much more important than state money. In Greece, for example, bank money makes up 84.26% of the total money supply.
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