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Quotes from old Books


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"The re-discount rate of the New York Federal Reserve Bank was cut from 4 to 3.5 per cent. Government securities were purchased in considerable volume with the mathematical consequence of leaving the banks and individuals who had sold them with money to spare. Adolph C. Miller, a dissenting member of the Federal Reserve Board, subsequently described this as 'the greatest and boldest operation ever undertaken by the Federal Reserve System, and... [it] resulted in one of the most costly errors committed by it or any other banking system in the last 75 years!' The funds that the Federal Reserve made available were either invested in common stocks or (and more important) they became available to help finance the purchase of common stocks by others. So provided with funds, people rushed into the market. Perhaps the most widely read of all the interpretations of the period, that of Professor Lionel Robbins of the London School of Economics, concludes: 'From that date, according to all the evidence, the situation got completely out of control".


From "The Great Depression" by Lionel Robbins (1934)


Quoted in "The Great Crash- 1929" by John Kenneth Galbraith


Seems too simple, right?


The period discussed is 1927. Anyway, I'm not trying to be clever, but that is a very direct, non-Keynesian discussion of the actual impact of QE (or in their case OPM), if you replace "common stocks" with "derivatives".


I'd just like to have a thread where you can jot down a quick note if you run into something brilliant written in the old world (pre-1970). I don't think it goes in the Book Thread because it's not about a specific book.



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"To Ricardo more than to any other economist belongs the credit for having given to the world the orthodox theory of the value of money. In his controversies with Malthus and with Bosanquet he gave one of the ablest expositions of monetary theory ever written. "That commodities would rise or fall in price, in proportion to the increase or diminution of money," said he, "I assume as a fact which is incontrovertible." Reply to Bosanquet, in Works, 326 note.


Footnote 1 Chapter 1 page 2


"The value of money, other things being the same, varies inversely as its quantity; every increase of quantity lowering the value, and every diminution raising it, in a ratio exactly equivalent. This...is a property peculiar to money." ...But, "In a state of commerce in which much credit is habitually given, general prices at any moment depend much more upon the state of credit than upon the quantity of money" Principles of Political Economy II. 30, 53.


Footnote 2 chapter 1 page 2


"Money And Credit Instruments In Their Relation To General Prices" Edwin Walter Kemmerer, PhD. 1907

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Great old books:


Old Gorgon Graham: https://books.google.com/books?id=eQcdAAAAMAAJ&num=19


Letters from a Self Made Merchant to his son https://books.google.com/books?id=Wg5FAAAAIAAJ&num=19&source=gbs_book_similarbooks




The books are full of applicable quotes. Not always politically correct given it was written in late 1800's/early 1900's

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