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The demise of monetary unions: United States 1932-1933

America's own currency union fractured after the Great Crash of Wall Street – but its swift recovery may hold lessons for eurozone policymakers today

A common refrain during the current eurozone crisis has been to compare it unfavourably to the success of the United States’ own "dollar-zone", backed by fiscal transfers and a central bank that actually behaves like a central bank. What is less commented upon is that the American single currency zone itself broke up in the 1930s, albeit briefly.

Its relatively swift recovery, moreover, may hold lessons for policymakers today.

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