An important reason that Hawtry's monetary theory of the business cycle is no longer considered useful is that:

the ratio of reserves to deposits is no longer determined by banks.
banks can no longer create bank reserves.
the ratio of currency to deposits is no longer determined by banks.
while changes in the amount of money influenced spending in the 19th century, they no longer do in the 20th.

Today reserve ratios of banks are set by a central bank. In the 19th century banks controlled their own reserve ratios. During good economic times they tended to reduce those ratios (which increased the amount of money in circulation), but when the economy went into recession, they tended to increase them (which decreased the amount of money in circulation). This pattern is an example of:

amplifying feedback.
dampening feedback.
no feedback.
both amplifying and dampening feedback.

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