In the 1970s, M2 was growing at 25% per year and banks were lending to the private sector at 2-3x the rate of nominal or real GDP growth, creating excessive credit expansion that fueled inflation; Volcker needed to stop this private sector lending, not just raise rates.
factualpending
Speaker
Hugh HenryEvidence Quote
“in the 1970s we had inflation. We had monetary inflation M2 growing at I don't know 25% per year... loan growth loan growth was probably two three times that of nominal GDP or real GDP.”
Source
Once In A Lifetime Opportunities in Precious Metals, Japan, And AI w/Hugh Hendry— Rebel Capitalist InterviewsCreated: 8/13/2026, 9:56:54 AM
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