“The growth of the money stock decelerated sharply in 1974 and early 1975.” To many readers such a headline would be regarded as something less than spectacular, being greeted by muffled yawns. But this development is undeserving of such a ho-hum response; the event is actually noteworthy on several counts. For one, the deceleration in money growth accompanied one of the worst periods of economic attainment since World War II. Second, the slowdown in monetary expansion occurred in spite of a continued expansion in the monetary base—a measure which historically has been a precursor for movements in the money stock. This second point is the focus of discussion in this article.