Long Depression

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Pat Conaty:

" The Depression between 1873 and 1896 is known as the Long Depression. There are strong similarities to our long recession. Way back then the downturn it was most severe in the USA. This was so and briefly because Lincoln introduced national currency as Greenback dollars for the first time during the Civil War. He in fact spent $450 million into the US economy to pay for the war. The Confederate states did the same. The bankers including the English ones funding the south and the north (via JP Morgan) went along with this early form of Quantitative easing because Lincoln while not redeeming this fiat money with gold and silver (redemption was suspended) during the war he did not say this money would never be redeemed. After Lincoln was killed (and who knows if there was a link here), US presidents went along with the desire of the goldbug bankers for redemption. A process of returning money to only gold in 1873 Coinage Act (which did not make silver a reserve commodity). This hard money legislation triggered huge deflation which lasted decades. Hence the Long Depression." (email, January 2014)