Friedman developed his own quantity theory of money that referred to Irving Fisher's but inherited much from Keynes. Friedman's 1956 "The Quantity Theory of Money: A Restatement" incorporated Keynes's demand for money and liquidity preference into an equation similar to the classical equation of exchange. Friedman's updated quantity theory also allowed for the possibility of using monetary or fiscal policy to remedy a major downturn. Friedman broke with Keynes by arguing that money demand is relatively stable—even during a downturn. Monetarists argued that "fine-tuning" through fiscal and monetary policy is counterproductive. They found money demand to be stable even during fiscal policy shifts, and both fiscal and monetary policies suffer from lags that made them too slow to prevent mild downturns.
