This book reads like a well-written textbook and has basically three parts:
1) A primer on supply and demand for money. (Those are parts I quoted from in my previous post).
2) An explanation of how fractional reserve banking works.
3) A history of banking in the U.K. and U.S., with some prescriptions to how an ideal Rothbardian system would work.
While Von Mises and Rothbard build and develop from much earlier monetarists, they reach radically different conclusions from them: Any increase in the overall price level is evil. Fractional reserve banking is immoral because it creates something out of nothing. Our modern banking system is built to create inflation to enrich some at the expense of others. Only by returning to a gold standard and eliminating our central bank and all fractional reserve banking can we achieve a completely stable business cycle (utopia with no involuntary unemployment).
Except for these ideas, parts 1 & 2 are similar to any textbook on Money and Banking, or a Principles of Macro text. Part 3 is very jaded, there is a lot of history that Rothbard omits or reinterprets. For example, there was a lot more going into the Panic of 1873 for the U.S. than Jay Cooke's bubble bursting-- the crisis started in Europe, which doesn't get mentioned. That said, there are a lot of interesting facts I was unaware of. I also liked having a Money & Banking text that didn't deal with interest rates at all, everything was in terms of supply and demand for money. That monetarist bent is badly needed in today's world focusing on a mythical "zero bound."
The book really illustrated for me the quixotic nature of the Austrian cause. Since coinage was invented, the makers of those coins have been debasing them in order to profit or inflate away debt. Since people have gotten used to calling their currency the "pound," "dollar," etc. instead of it just being "gold," people don't notice the debasement. But it would take a radical departure from thousands of years of human nature to move people away from this problem, even if currency was "denationalized."
Rothbard compares the fixing of a price of gold as the same as a government determining uniform weights and measures -- a centimeter is the same everywhere. But the value of a centimeter never changes whereas gold-- being a commodity-- sees its value change with supply and demand, which then changes the value of any currency whose price is fixed to it. The Austrians seemingly ignore this. For example, the late 1800s period in the U.S. the population was growing, output was increasing, but gold supplies were not growing so much so the value of gold rose and prices fell. Rothbard would say this is a naturally good thing, lower prices mean people can afford to buy more. But if you're a farmer who has fixed obligations -- contracted workers, a loan from a bank, etc. lower prices means it's much harder to stay in business and not default. (Hence we had a bimetallic inflationist political movement as a result.) Rothbard completely ignores this.
These fluctuations in the value of gold can happen suddenly and unexpectedly. Given so much of the (correct) emphasis that I see Von Mises placing on expectations of entrepreneurs, I find Rothbard's position pretty problematic.
As mentioned in my previous post, Rothbard and Mises acknowledge that prices are often sticky, but have a one-size-fits-all explanation for this that doesn't actually fit everywhere. All weight is put on the evil of prices inflation, no weight is put on the harmful effects of deflation.
I now see the Austrians as on par with the hard-core left-wing Communists who want to issue in a utopia that is impossible due to human nature. The idea that simply by moving to a 100% reserve gold system and moving to anarcho-capitalism will solve all of our ills and make everyone purely rational yet benevolent is pure nonsense. It's odd to me that as such an astute student of history, Rothbard doesn't see the continual "Road to Serfdom"-like cycle that all civilizations have ridden since the Fall of Man.
In the end, there is an Appendix where Rothbard absolutely rips Lawrence White, also an Austrian, for what Rothbard sees as an incorrect interpretation of the history of free banking. Austrians, like Keynesians, have a good reputation for trying to destroy and humiliate those they don't like.
George Selgin, whose Theory of Free Banking will be my next read, is a former Rothbardian disciple who sums it up thus:
Rothbard, on the other hand, was only too determined to identify himself with the Austrian School and, more than that, to both take part in a personality cult, built around von Mises, and attract such a cult himself. One sign of the presence of such a cult is precisely the scorn its members heap on potential rivals to the cult figure.
As a monetary economist (I don't pretend to judge Rothbard's other economic contributions) Rothbard was mediocre to bad. His version of the Austrian business cycle theory was naive--in essence it equated behavior of M consistent with keeping interest rates at their "natural" levels with the elimination of fractional-reserve banking, an equation that holds only with the help of about a dozen auxilliary assumptions, all of which are patently false. He then went on to conjure up an equally false history of banking and of bank contracts designed to square his theory of the cycle, with its implied condemnation of fractional reserve banking, with his libertarian ethics.
As such, I give this book 3 stars out of 5. It's very readable, and you can learn a good deal of history, monetary economics, and how banking works from it. However, if you don't take it with a large grain of salt you may not see the many errors and omissions that cause it to be quite slanted.