When business in the United States underwent a mild contraction ... the Federal Reserve created more paper reserves in the hope of forestalling any possible
bank reserve shortage. The "Fed" succeeded; ... but it nearly destroyed the economies of the world, in the process. The excess credit which the Fed pumped into the economy spilled over into the stock market-triggering a fantastic speculative boom. Belatedly, Federal Reserve officials attempted to sop up the excess reserves and finally succeeded in breaking the boom. But it was too late: ... the speculative imbalances had become so overwhelming that the attempt precipitated a sharp retrenching and a consequent demoralizing of business confidence. As a result, the American economy collapsed.
It was reportedly written by a young economist by the name of Alan Greenspan and explains that it came from an article "Gold and Economic Freedom" from The Objectivist, 1996, reprinted in Ayn Rand's Capitalism: The Unknown Ideal, New York: Penguin, 1987.