Oh the relief of quantitative easing! Who could fail to welcome a fiscal laxative guaranteed to loosen the bankers’ constipated hold on credit? But before much more of the mixture is gulped down, it may be salutary to glance at the effect of the purgatives administered to ease economic bowels in the late 17th century.
The credit crunch that afflicted the country in the 1690s produced results with which we are familiar. In the words of Lord Macaulay, ‘the great instrument of exchange became thoroughly deranged, all trade, all industry were smitten as with a palsy’. The crisis was caused by a ruinous foreign war, by the export of silver coins which were worth more abroad than at home, and, as this delightful book makes clear, by an army of counter- feiters whose dud coins drove the good ones out of circulation.
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