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To: SeeSharp
Smoot-Hawley killed 90% of our foreign trade.

Imports during 1929 were only 4.2% of the United States' GNP and exports were only 5.0%. Monetarists, such as Milton Friedman, who emphasize the central role of the money supply in causing the depression, note that the Smoot-Hawley Act only had a contributory effect on the entire U.S. economy.

Smoot Hawley is red herring and had little or no effect on the Great Depression.

61 posted on 11/02/2015 4:50:45 AM PST by central_va (I won't be reconstructed and I do not give a damn.)
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To: central_va

The Monetarists are wrong about a lot of things. This is one of them. It was Smoot Hawley that sent the banking system into a general system-wide failure. More than a third of the US agricultural production was sold overseas before SH. That trade collapsed after SH and the rural banks failed en masse. That in turn brought down the regional banks, which caused a collapse in the credit market, which brought down the manufacturing sector. SH was indeed a “contributory effect”, just like throwing a stone to a drowning man. Credit expansion by the Fed caused the depression and the stock market crash, and then SH destroyed our foreign trade.


62 posted on 11/02/2015 6:08:48 AM PST by SeeSharp
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