Carl Snyder, the Real Bills Doctrine, and the New York Fed in the Great Depression

Carl Snyder was one of the most prominent U.S. monetary economists of the 1920s and 1930s. His pioneering work on constructing the empirical counterparts of the terms in the equation of exchange led him to formulate a four percent monetary growth rule. Snyder is especially apposite because he was on the staff of the New York Federal Reserve Bank. Despite his pioneering empirical work and his position as an insider, why did Snyder fail to effectively challenge the dominant real bills views of the Federal Reserve (Fed)? A short answer is that he did not possess a convincing version of the quantity theory that attributed the Great Depression to a contraction in the money stock produced by the Fed as opposed to the dominant real bills view attributing it to the collapse of speculative excess.