scary , did we draw wrong lessons from history?

http://ftalphaville.ft.com/blog/2009/02/09/52217/depression-alert-international-institution-edition/

Has anyone else noticed that the current crisis sheds light on one of the great controversies of economic history?

A central theme of Keynes’s General Theory was the impotence of monetary policy in depression-type conditions. But Milton Friedman and Anna Schwartz, in their magisterial monetary history of the United States, claimed that the Fed could have prevented the Great Depression - a claim that in later, popular writings, including those of Friedman himself, was transmuted into the claim that the Fed caused the Depression.

Specifically, the theory goes, the Great Depression could have been avoided had the Fed moved quickly and aggresively to expand the monetary base.

That arguably, is what the US and others are doing now - via quantitative easing. And now, as Krugman puts it:

So here we are, facing a new crisis reminiscent of the 1930s. And this time the Fed has been spectacularly aggressive about expanding the monetary base.

And guess what - it doesn’t seem to be working.

I think the thesis of the Monetary History has just taken a hit