Table of Contents
Foreword xiii
STABILIZATION OF THE MONETARY UNIT—
FROM THE VIEWPOINT OF THEORY (1923) 1
Introduction 3
CHAPTER I The Outcome of Inflation
1 Monetary Depreciation 5
2 Undesired Consequences 8
3 Effect on Interest Rates 9
4 The Run from Money 10
5 Effect of Speculation 11
6 Final Phases 12
7 Greater Importance of Money to a Modern Economy 13
CHAPTER II The Emancipation of Monetary Value
from the Influence of Government
1 Stop Presses and Credit Expansion 15
2 Relationship of Monetary Unit to World Money—Gold 16
3 Trend of Depreciation 17
CHAPTER III The Return to Gold
1 Eminence of Gold 19
2 Sufficiency of Available Gold 20
CHAPTER IV The Money Relation
1 Victory and Inflation 22
2 Establishing Gold “Ratio” 23
CHAPTER V Comments on the “Balance
of Payments” Doctrine
1 Refined Quantity Theory of Money 26
2 Purchasing Power Parity 27
3 Foreign Exchange Rates 28
4 Foreign Exchange Regulations 30
CHAPTER VI The Inflationist Argument
1 Substitute for Taxes 32
2 Financing Unpopular Expenditures 33
3 War Reparations 34
4 The Alternatives 35
5 The Government’s Dilemma 37
CHAPTER VII The New Monetary System
1 First Steps 39
2 Market Interest Rates 41
CHAPTER VIII The Ideological Meaning of Reform
1 The Ideological Conflict 43
Appendix. Balance of Payments and Foreign Exchange Rates 45
MONETARY STABILIZATION AND
CYCLICAL POLICY (1928) 51
Preface 53
PART I Stabilization of the Purchasing Power of the
Monetary Unit
CHAPTER I The Problem
1 “Stable Value” Money 59
2 Recent Proposals 60
CHAPTER II The Gold Standard
1 The Demand for Money 62
2 Economizing on Money 64
3 Interest on “Idle” Reserves 66
4 Gold Still Money 68
CHAPTER III The “Manipulation” of the Gold Standard
1 Monetary Policy and Purchasing Power of Gold 69
2 Changes in Purchasing Power of Gold 71
CHAPTER IV “Measuring” Changes in the Purchasing
Power of the Monetary Unit
1 Imaginary Constructions 73
2 Index Numbers 76
CHAPTER V Fisher’s Stabilization Plan
1 Political Problem 79
2 Multiple Commodity Standard 80
3 Price Premium 81
4 Changes in Wealth and Income 83
5 Uncompensatable Changes 85
CHAPTER VI Goods-induced and Cash-induced Changes
in the Purchasing Power of the Monetary Unit
1 The Inherent Instability of Market Ratios 87
2 The Misplaced Partiality to Debtors 89
CHAPTER VII The Goal of Monetary Policy
1 Liberalism and the Gold Standard 92
2 “Pure” Gold Standard Disregarded 93
3 The Index Standard 94
PART II Cyclical Policy to Eliminate Economic Fluctuations
CHAPTER I Stabilization of the Purchasing Power of the
Monetary Unit and Elimination of the
Trade Cycle
1 Currency School’s Contribution 99
2 Early Trade Cycle Theories 100
3 The Circulation Credit Theory 102
CHAPTER II Circulation Credit Theory
1 The Banking School Fallacy 105
2 Early Effects of Credit Expansion 107
3 Inevitable Effects of Credit Expansion on Interest Rates 109
4 The Price Premium 110
5 Malinvestment of Available Capital Goods 110
6 “Forced Savings” 112
7 A Habit-forming Policy 113
8 The Inevitable Crisis and Cycle 114
CHAPTER III The Reappearance of Cycles
1 Metallic Standard Fluctuations 117
2 Infrequent Recurrences of Paper Money Inflations 118
3 The Cyclical Process of Credit Expansions 119
4 The Mania for Lower Interest Rates 121
5 Free Banking 123
6 Government Intervention in Banking 125
7 Intervention No Remedy 126
CHAPTER IV The Crisis Policy of the Currency School
1 The Inadequacy of the Currency School 128
2 “Booms” Favored 130
CHAPTER V Modern Cyclical Policy
1 Pre–World War I Policy 131
2 Post–World War I Policies 132
3 Empirical Studies 133
4 Arbitrary Political Decisions 135
5 Sound Theory Essential 137
CHAPTER VI Control of the Money Market
1 International Competition or Cooperation 139
2 “Boom” Promotion Problems 141
3 Drive for Tighter Controls 142
CHAPTER VII Business Forecasting for Cyclical Policy
and the Businessman
1 Contributions of Business Cycle Research 145
2 Difficulties of Precise Prediction 146
CHAPTER VIII The Aims and Method of Cyclical Policy
1 Revised Currency School Theory 148
2 “Price Level” Stabilization 149
3 International Complications 150
4 The Future 151
THE CAUSES OF THE ECONOMIC CRISIS (1931) 153
CHAPTER I The Nature and Role of the Market
1 The Marxian “Anarchy of Production” Myth 155
2 The Role and Rule of Consumers 156
3 Production for Consumption 157
4 The Perniciousness of a “Producers’ Policy” 158
CHAPTER II Cyclical Changes in Business Conditions
1 Role of Interest Rates 160
2 The Sequel of Credit Expansion 161
CHAPTER III The Present Crisis
A. Unemployment
1 The Market Wage Rate Process 164
2 The Labor Union Wage Rate Concept 165
3 The Cause of Unemployment 166
4 The Remedy for Mass Unemployment 167
5 The Effects of Government Intervention 168
6 The Process of Progress 169
B. Price Declines and Price Supports
1 The Subsidization of Surpluses 170
2 The Need for Readjustments 172
C. Tax Policy
1 The Anti-capitalistic Mentality 173
D. Gold Production
1 The Decline in Prices 174
2 Inflation as a “Remedy” 176
CHAPTER IV Is There a Way Out?
1 The Cause of Our Difficulties 177
2 The Unwanted Solution 178
THE CURRENT STATUS OF BUSINESS
CYCLE RESEARCH AND ITS PROSPECTS FOR
THE IMMEDIATE FUTURE (1933) 179
1 The Acceptance of the Circulation Credit Theory
of Business Cycles 181
2 The Popularity of Low Interest Rates 182
3 The Popularity of Labor Union Policy 184
4 The Effect of Lower than Unhampered Market
Interest Rates 184
5 The Questionable Fear of Declining Prices 185
THE TRADE CYCLE AND CREDIT EXPANSION:
THE ECONOMIC CONSEQUENCES OF CHEAP MONEY (1946) 187
1 Introductory Remarks 189
2 The Unpopularity of Interest 189
3 The Two Classes of Credit 191
4 The Function of Prices, Wage Rates
and Interest Rates 192
5 The Effects of Politically Lowered Interest Rates 194
6 The Inevitable Ending 198
Index 199
