Friedrich A. Hayek Attributes the Severity and Duration of the Depression to the World Taking Monetary Policy Advice from the "Stabilizers" (Forerunners of the Monetarists)

Hayek wrote Monetary Theory and the Trade Cycle as an explication of the monetary causes of the business cycle. However, in order to do so, he believed that he had to “save the sound elements in the monetary theories of the trade cycle” by refuting those naïve quantity theorists who posited a simplistic and mechanical connection between the aggregate money supply and the average price level. Thus he took after the price “stabilizers” like Irving Fisher and Gustav Cassel who were the forerunners of the modern monetarists. He identified “the critique of the program of the ‘stabilizers’” as “the central theme of this book.” Nor did Hayek tread lightly in verbalizing his criticisms. He placed the blame for “the exceptional severity and duration of the depression” squarely on central banks’, particularly the Fed’s, “experiment” in “forced credit expansion,” first to stabilize prices in the 1920s, and then to combat the depression in the early 1930s. Hayek defiantly declared:

We must not forget that, for the last six or eight years [up to 1932] monetary policy all over the world has followed the advice of the stabilizers. It is high time that their influence, which has already done harm enough, should be overthrown.

--Joseph T. Salerno, introduction to Prices and Production and Other Works: F.A. Hayek on Money, the Business Cycle, and the Gold Standard, by F.A. Hayek (Auburn, AL: Ludwig von Mises Institute, 2008), xix-xx.