Whether market participants hoard money, or dishoard
it, the amount of money in their wallets and their bank balances in the aggregate remains exactly the same ceteris paribus.
Given a tendency to hoard or dishoard
money, or if many substitutes for currency and deposits exist, "near moneys" then the fixed scheme is easily defeated.
Similar factors will also encourage firms to continue to gradually dishoard
their labour inputs, pushing productivity towards trend levels and unemployment through the 5 per cent level later this year.
When allowed to run its course, this relative price adjustment inevitably re-establishes a natural interest rate sufficiently high to stimulate capitalists and entrepreneurs to dishoard
cash and actively seek out investment opportunities.
When they subsequently dishoarded
labour in the 1980s, they would have experienced higher than average productivity growth.