301R. I. L. Hore-Belisha to Harrod, 4 April 1933 [a]

Hore-Belisha thanks Harrod for his article in the Daily Telegraph. He asks to explain exactly how Harrod's Currency Equalization Fund is to operate, [1] and to define the term "idle money". [2]

  1. 1. Harrod, "Britain's Lead in Currency Policy" ( 1933:4 , here as press item 6 ). The proposal of a Currency Equalisation Fund is expounded on [jump to page] .

    2. The term is not used in Harrod's article, and must therefore belong to the letter (not found) accompanying it. A number of Harrod's writings of this period suggest that he was concerned with people's hoarding, which he saw as side-tracking money from effective circulation and thereby reducing the monetary demand for goods and producing a deflation of profits (Harrod, "The Challenge to Treasury Orthodoxy", 1933:6 , pp. 578-79; see also, for instance, International Economics, 1933:10 , pp. 171, 147-48, 153, and Harrod's letters to Walter Runciman of 22 June and 6 July 1932: letters 243 , [jump to page] and 249 , [jump to page] and passim). He was worried that an increase in the quantity of money would be ineffective if "held in idleness by the public" ("Currency and Central Banking", 1933:13 , p. 118). For a comparison of Harrod's and Keynes's interpretations of "hoarding" see note 2 to letter 280 .

    1. a. From Treasury Chambers, Whitehall # , one page TLS, in HPBL Add 71184/182.


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