Wayne - (...I'm always very interested to hear what Milton Friedman thinks...)
A different take from mises.org
(Truth in Data)
"...
AEN: The dispute about the Great Depression and the business cycle goes beyond the numbers, doesn't it?
SALERNO: It goes to the core of economic theory. For most mainstream economists, inflation is not a matter of money and bank credit expansion; it is essentially a price phenomenon. If prices don't rise, there is no inflation. It doesn't matter what the monetary data say. In the 1920s, there was no substantial change in prices, due to enormous productivity and output increases. But to them, that is sufficient evidence that they don't need to look any deeper.
Only Austrians truly believe inflation is a monetary phenomenon. When you increase the amount of money in circulation, it brings many more changes than just price increases. We see a fall in the loan rate of interest. We see a boom in real estate as a higher-order good. We see a boom in the stock market, which trades titles to higher-order goods, that is, capital goods. To focus on inflation as price increases means we don't capture the fullness of the inflationary phenomenon... "
Regards, Don
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