What Caused the Great Depression?

An interesting answer one can glean from Scott Sumner's The Midas Paradox is....

America' oldest enemy, France!

"France was easily the largest gold hoarder during the Great Depression. Her monetary gold stock rose almost continually from $711 million in late 1926 to over $3.2 billion at the end of June 1932 (nearly 30% of the world total)" (p. 138).


  1. I thought this was widely accepted? Their hoarding of gold and refusal to devalue caused a large contraction in the global money supply.

    Or perhaps, you could argue that there extreme experiment in defending their gold reserves discredited a rigid gold standard, moving that theory more quickly into the dustbin of history (for the most part...), thus raising the rate and steadiness of growth in the long run, at the expense of the 1930's depression (and arguably, a world war). But it's complicated, right?

    1. "I thought this was widely accepted?"

      I don't say it isn't! But I just learned it from Sumner.


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