The Great Financial Crisis of 1914: What Can We Learn from Aldrich-Vreeland Emergency Currency?
检验弗里德曼和施瓦茨关于奥尔德里奇-弗里兰紧急货币在1914年金融危机中作用的猜想，并从中汲取货币政策教训。
At outbreak of World War I, biggest gold outflow in a generation posed a double-barreled threat to American finance: An internal drain of currency from banking system and an external drain of gold to Europe. The absence of an operational central bank encouraged Treasury Secretary William G. McAdoo to improvise modern principle of aiming an independent weapon at each policy target. He employed a form of capital controls to deal with external threat, shutting New York Stock Exchange (NYSE) for more than four months to prevent Europeans from selling their American securities and demanding gold in return. And he invoked emergency currency provisions of Aldrich-Vreeland Act to deal with internal threat, allowing banks to issue national bank notes without normal requirement that currency be secured by U.S. goverment bonds. According to Friedman and Schwartz (1963, p.196), by November 1914 the country had recovered from... declaration of war in Europe, thanks in no small part to availability of Aldrich-Vreeland emergency currency. This paper tests Friedman and Schwartz's conjecture about power of Aldrich-Vreeland emergency currency and draws lessons for monetary policy.