Scientism: The New Road To Serfdom Revisited, Part 3

As we explained in Part 2, modern central banking was birthed in America by the accident of war finance, not by virtue of a policy model that held capitalism needed a government nanny to keep it on the straight and narrow.

Indeed, during the immediate post-war period (1919-1922), the nascent monetary politburo actually stood aside, as Jim Grant has so lucidly described in the Forgotten Depression. Washington’s massive war financing had caused a veritable economic boom in the domestic economy owing to war procurement by the US military, but also because upwards of $9 billion (22% of pre-war US GDP) was loaned to the nearly bankrupt allies in England and France. The latter used their loan proceeds to turn the US economy into their granary and arsenal.



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