Monetary policy ideology shapes credit allocation during economic crises.
During the Great Depression and the Great Recession, monetary policy was influenced by beliefs against using inflation to fix economic problems. In the Great Depression, the Federal Reserve denied credit to banks involved in risky investments. In the Great Recession, the Federal Reserve used a complex method to control inflation while providing credit. Both policies were based on the idea that simply giving out money wouldn't solve economic issues. Adolph Miller and Ben Bernanke, leaders at the time, increased the Federal Reserve's support for the U.S. Treasury.