Could you list some specific errors he made?
His error was believing that money is to the economy as grease is to a machine. More of it will ease business transactions -- too little of it will cause the thing to seize up -- and that the government can determine the proper amount.
His analysis of the cause of the Great Depression was that, as the economy spiraled down, the Federal Reserve did not provide enough money [liquidity in modern parlance] for business to dig itself out of the hole. FDR agreed and ended the ability of Americans to trade their paper dollar s for gold. To complete the circle, he declared it illegal for Americans to own gold and forced them to sell it all back to the government.
All of this in an effort to eliminate the limits on the issuance of paper dollars imposed on the government by the gold standard. It didn't work, of course, we were still in the Depression at the outbreak of the war in 1940.
It isn't working today, either. We are still caught in the same slow-growth stagnation in 2013 we were in 1938.
Though money is certainly necessary to the operation of well-functioning economy, it is not like grease that can be added or drained from a machine as needed by a wise mechanic. Any amount of money can serve as long as prices are allowed to rise or fall according to the needs of consumers [i.e., the market].
Mr. Friedman, in his younger years, though certainly more free market than today's mainstream economists, was enamored of big-government solutions to economic issues. As we all know, he famously designed the tax withholding system during WWII [which he later admitted to regret] and believed the Federal Reserve should increase the money supply by 2% or 3% a year to promote growth -- numbers, by the way which he picked out of thin air to match his opinions of sensible growth.
Do not misunderstand me. In his later years, Milton Friedman proved himself a very capable and important advocate of free markets. But we should not ignore his myopia on what money is and his early efforts to put government in charge of it.