See if you can make out the contours of history repeating itself, from Murray Rothbard’s America’s Great Depression:
It is characteristic of depressions that, because of the inherently fraudulent nature of the commercial banking system, any real attempt by the public to redeem its own property from the banks must cause panic among banks and government alike. And so, on February 3,[1932] [President] Hoover organized an anti-hoarding drive, headed by a Citizens’ Reconstruction Organization (CRO) under Colonel Frank Knox of Chicago. The hoarder is unpatriotic, ran the hue and cry, He restricts and destroys credit (i.e., he is exposing the unsound nature of the credit which was granted against his interests and in destruction of his property). A group of top-level Anti-Hoarding patriots met on February 6 to organize the drive: present were General Dawes, Eugene Meyer, Secretaries Lamont and Mills, A.F. Whitney, Alvanley Johnston, and industrialist Magnus Alexander. The CRO urged hoarders to invest in short-term Treasury securities, i.e., in unproductive rather than productive investments. On March 6, Hoover delivered a public address on the evils of hoarding: “the battle front today is against the hoarding of currency.” Hoarding has lowered prices and incomes, and restricted credit; it strangles our daily life. “No one will deny that if the vast sums of money hoarded in the country today could be brought into active circulation there would be a great lift to the whole of our economic progress.” Hoover then commended Colonel Know for his “great battle against…the American people, and called on everyone to serve in protection of the American home.” Perhaps Hoover is correct when he now gives credit to the Knox drive for the fact that “hoarding” never increased much during 1932; it reached a peak of $5.44 billion in July, and never rose above that until the bank crisis in February, 1933. But if Hoover is correct, praise is not his appropriate reward. For it means that bank liquidation was postponed for another year and the final banking crisis intensified, and it also means that the public was not at last permitted to find out for itself the great truth of the nature of its banking system.
