Tim Congdon’s ‘The Quantity Theory of Money: A New Restatement’ is a crucial contribution to economic thought.
by Steve H. Hanke
The Daily Economy
Before I review The Quantity Theory of Money: A New Restatement (PDF) chapter-by-chapter, allow me to put things into context. Tim Congdon is the deepest thinker in this field and one with enormous experience as a banker with real skin in the game. If that weren’t enough, he started his career as an economics journalist at The Times in the 1970s. In short, unlike most economic writing, his book is readable. Following his work at The Times, he founded Lombard Street Research, when I first became acquainted with him. At the time, I was strategizing and trading at Friedberg Mercantile Group, a broker-dealer in Toronto, where I am currently chairman emeritus. He kept me well-supplied with his writings, and I gave them my most careful and anxious attention. Why? Because his forecasts were usually right — and often very contrary to the consensus.
During the Thatcher years, when monetarism was introduced to the United Kingdom, Congdon was at the center of things as a high-profile monetarist and forecaster, and one of the Chancellor of the Exchequer’s “Wise Men.” Finally, it was Congdon’s work, particularly Money in a Free Society — a book which I spent several weeks in Paris studying and corresponding with Congdon on — that incited my transition from a recipient to a supplier of monetary research.