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Excerpt from Hicks, Trade Cycle (Part 2)

Excerpt from Hicks, Trade Cycle (p.162):

It is almost inevitable that at the top of the boom, trade credits (as distinguished from banking credit) will be overextended; but the collapse of trade credit need do no more than limited harm, if the reserves of more widely acceptable money, in the hands of the banking system, or creatable by the banking system, are unimpaired.  ... Really catastropic depression is most unlikely to occur as a result of the simpleoperation of the real accelerator mechanism; it is likely to occur when there is profound monetary instability - when the rot in the monetary system goes very deep.1 (Go to Note 1 of the previous post)

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