Posted 12/6/2018 09:28 (#7152697 - in reply to #7152648) Subject: RE: History doesn’t always repeat but sometimes rhymes
The United States was a net exporter for almost all of the 1930's except for one year 1936 if I remember correctly. Smoot Hawley had little effect on the depression.
Lack of deposit insurance is what caused the great depression. When banks failed people really lost all of their money. This caused the money supply in the United States to drop over 40%. This sparked deflation.
The United States came to its senses and quit the gold standard in 1933 and tried to expand money supply but it was difficult because international trade was still based on the gold standard.
In the end the only thing that could have fixed the system did, large government deficits because of WW2.
To help insure the Great Depression doesn't happen again we came up with deposit insurance(the FDIC), dumped the gold standard for good in 1971, and we now run government deficits almost every year.
In a recession or depression the only thing that works is Government deficit spending, it works every time it has been tried.
Edit to add: As long as the currency is free floating and not pegged to gold or another currency deficit spending works and as long as the country isn't in debt in something other than its own currency. This is why Turkey, Argentina, and Venezuela are having issues.