The ECONOMICS and POLITICS of MONEY.

The article examines a correlation between monetary policy and business cycles in the United States, in light of a reversal of the country's dependence on fiscal policy. Congressional investigations by Senator Paul Douglas and by Representative Wright Patman led to the economic stabilization policy against inflation and recession. The investigation hearings found: fiscal and monetary policy together might control economic instability; quantity of money affects business cycles; monetary theory should have been used since 1946; the effectiveness of monetary policy on total consumer spending, government security prices, and yields was not determined; and the Federal Reserve has the power to stop inflation, but risks deflation and mass unemployment.