[barry-cotter]

Central banks and macroeconomists have learned a lot since the Great Depression, mostly of the “don’t do that again” variety. For example the Fed caused the Great Depression by contracting the money supply by a third in the middle of a recession, killing US economic growth for decades. They are unlikely to repeat that mistake.

[notahacker]

Yes. This is why they no longer operate on a gold standard, which de facto contracts the money supply (people want to hold "safe" gold rather than circulate money) in the middle of a recession

[barry-cotter]

The Fed did a lot worse than a Gold Standard would have. You can’t blame the gold standard for a decision to contract the money supply.

[notahacker]

They were literally on a gold standard at the time. You absolutely can blame the gold standard for the Fed decision to raise interest rates to protect gold reserves.

The only decision the Fed could (and eventually did) take to allow the money supply to expand was removing the US from the gold standard.