Larry White has tried to find in Mises' writings evidence that he understood that malivestment occurs when there is an excess supply of money. Salerno argues that this evidence comes from Mises' early writings. According to Salerno, in his fully developed thought, Mises came to understand that any increase in the quantity of money, regardless of what was happening to the demand to hold money, causes the money rate of interest to fall below the natural rate.
Salerno's evidence is largely based upon policy. He finds quotations where Mises suggests that prohibiting any further expansion of "fiduciary media" is desirable. Fiduciary media is bank issued money used to fund loans.
I find Salerno's approach odd. From a Virginia School perspective, policy rules are nearly always "least bad" options. It could be that the ideal situation would be a banking system that adjusts the quantity of bank money according to the demand to hold bank money. However, it is possible that the damage resulting from banks creating an excess supply of money is so great that the least bad option is to prevent any increase in the quantity of money, regardless of what is happening to the demand to hold money. Having the price level adjust the real quantity of money to the demand for money is better than the possibility that the banking system would generate an excess supply of money.
But if Mises really did believe that an increase in the quantity of money, say, smaller than an increase in the demand to hold money, would lead to the money rate falling below the natural rate, then he was wrong. And that seems to be Salerno's position. Mises was wrong. (Of course, Salerno is just as wrong as Mises.)