He realized with tremendous insight, this is essentially a business cycle theory.
It's never talked about as such in the textbooks.
It was not only a theory of money and a theory of international payments,
it was also a business cycle theory. It's a simple model.
The banks pump in money, prices go up as euphoria,
and then something happens, they have to contract and there's bankruptcy and liquidation.
It's a very simple model of a business cycle.
He combined that, Mises, with Wichsel's, Wichsel was a Swedish-Austrian,
by the Austrian-Swedish Boehm-Bawerk follower, combined that with Lixsell's analysis of interest rates and how if a banking rate falls below the natural rate of interest or the free market rate of interest, it'll be inflation.
It's combined that and wound up with an integrated, magnificent path-baking theory of the business cycle.
And essentially what it is, what it says is that an increase in supply of money and credit through the banking system, through central banking, not only causes inflation, everybody will admit that, at least all the neoclassicals will admit that, excuse me, admit that, it also causes other disturbances.