The icy moons

Meltzer, Michael

doi:10.1007/978-3-319-07608-9_13

Cited by 1 publication

(2 citation statements)

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“…Then it paused, arguing on January 30, 1930, that the Fed "had already …set in motion a trend which should result in lower rates …and we feel we should not interfere in that movement either in the direction of halting it or 60 Eichengreen (1992) and Clark (1967). 61 Meltzer (2003). 62 Friedman andSchwartz (1963) pages 290-292.…”

Section: Journal Of Applied Corporate Finance • Volume 31 Numbermentioning

confidence: 99%

“…In the end, Allan Meltzer concluded that "The economies of the United States and much of the rest of the world became victims of the Federal Reserve's adherence to an inappropriate theory and the absence of basic economic understanding." 65 The sensational Congressional hearings of February 1933 led by Ferdinand Pecora66 revealed what to the modern observer seems like an astonishing array of bad behavior. The operation of "pools," groups of wealthy investors, sought to drive prices up in order to draw in more investors and then sell at the top prices.…”

Section: Conclusion: What Have We Learned?mentioning

confidence: 99%

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The Great Crash of 1929: A Look Back After 90 Years

Bruner

Miller

2019

J Applied Corp Finance

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The Great Crash of 1929 ranks among the climactic events of the last century, apparently heralding the beginning of the Great Depression. This event raises at least four questions that are relevant today: Why did the “Roaring 20s” roar? Some prominent contemporaries held that the decade roared because of consumerism, credit growth, and the Jazz Age. However, recent research suggests an alternative explanation: a revolution in manufacturing and technology that amplified economic growth and volatility in markets. Was the boom in equities a “bubble?” Both the authors’ research and other studies show surprisingly weak evidence of a bubble. The boom probably reflected the technology shock of the ‘20s. If there was a bubble, it was limited in time, breadth, and impact. What caused the Crash? The onset of an ordinary recession, surprising changes in monetary policy by the Fed, growing regulation, and rising protectionism all help to explain a sharp and sudden change in investor sentiment. Did the Crash cause the Great Depression, as popular opinion has long maintained? No. The cycle of economic contraction had begun well before the crash. Furthermore, the wealth effect of the Crash was limited. The pivot from recession into Great Depression reflected the abandonment of the Gold Exchange Standard, a wave of bank panics and collapse of credit, protectionism, and a number of maladroit public policies. But if the Crash did not cause the Depression, it probably amplified the effects of forces already at work. Answers to these questions, illuminated by careful research, remind decision‐makers in business and government that the first explanations for historical events are not always the best, that complex systems have unintended consequences, and that gaps in information make the Great Crash a difficult standard by which to assess future events. The use of historical precedent warrants caution and great humility in the makers of public policy.

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Section: Journal Of Applied Corporate Finance • Volume 31 Numbermentioning

confidence: 99%

Section: Conclusion: What Have We Learned?mentioning

confidence: 99%