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by bjnortier_hn
5716 days ago
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Which Wikipedia article? There's a difference between propping up a failing bank (which I believe Friedman would be against) and providing liquidity to the banking system when a bank run occurs on a well-capitalised bank (which I believe he would support). If you watch the Volume 3 "Anatomy of Crisis" about the depression, when a run on the Bank of the United States occurred despite it's being a sounds entity (when it was liquidated it paid back 92.5 cents on the dollar). It's failure created a domino effect according to Friedman. So he supported providing liquidity in that scenario. I don't believe Friedman would support QE[2] when the banks are well capitalised. My interpretation of his ideas is that he supported a stable money supply, and Friedman was definitely against printing money in general. That being said, the ideas I'm referencing were expressed in a time when inflation was a big problem. I wish he were alive today, I would be very interested in his opinion. |
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