Henry Simons and The Money Supply
Finally, Simons believed the price level needed to be more flexible to accommodate fluctuations in output and employment. To this end, he advocated a minimum of short-term borrowing, and a maximum of government control over the circulation of money. This would result in an economy with a greater tolerance of disturbances and the prevention of "accumulated maladjustments" all coming to bear at once on the economy. In sum, Simons’ chief problem was with a financial system in which the movement of the price level was in many ways beholden to the creation and liquidation of short-term securities. To Simons this threatened financial instability.
Read more about this topic: Henry Calvert Simons
Famous quotes containing the words henry, money and/or supply:
“The scientific spirit is of more value than its products, and irrationally held truths may be more harmful than reasoned errors.”
—Thomas Henry Huxley (1825–95)
“Is money money or isn’t money money. Everybody who earns
it and spends it every day in order to live knows
that money is money, anybody who votes it to be
gathered in as taxes knows money is not money. That
is what makes everybody go crazy.... When you earn
money and spend money every day anybody can know the
difference between a million and three. But when you
vote money away there really is not any difference
between a million and three.”
—Gertrude Stein (1874–1946)
“The supply of words in the world market is plentiful but the demand is falling. Let deeds follow words now.”
—Lech Walesa (b. 1943)