The Monetary Lessons of the Not-So-Great Depression

Did the collapse of the financial sector cause the recession or did the recession cause the collapse of the financial sector? Was the supply of money too "easy" in the run-up to the collapse or was it too "tight"? Did the exhaustion of monetary policy tools necessitate a surge of government spending to prop up the economy during our near-depression? Or did the failure to use available monetary policy tools in part cause our near-depression? Should we be worried about getting hammered by high inflation, or should we worry inflation is not high enough?

If you think you know the answers to these questions, it might be time to think again. In this month's edition of Cato Unbound, we're exploring "The Monetary Lessons of the Not-So-Great-Depression." Leading off the discussion with a probing, provocative essay, Bentley University monetary economist Scott Sumner argues that just about everybody is getting it wrong. To tell us whether Sumner's getting it right, we've lined up a diverse, top-notch panel of money specialists including James Hamilton of the University of California, San Diego, George Selgin of the University of Georgia, and Jeffrey Hummel of San Jose State University.

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