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It doesn't exactly take a Nobel Prize in Economics to figure out deflation is in the forecast - only access to good data. Since the Federal Reserve stopped repo
by lowkey 16y ago
It doesn't exactly take a Nobel Prize in Economics to figure out deflation is in the forecast - only access to good data. Since the Federal Reserve stopped reporting M3 Money Supply several years ago, it is a bit harder to come by this data - but not impossible.
Take a look at this link and tell me if you can spot the deflation: http://www.shadowstats.com/alternate_data/money-supply-charts http://www.shadowstats.com/alternate_data/money-supply-chart...
Banks got bailed out by taxpayers but they are not making loans - hence M3 velocity is collapsing. When the money supply contracts, deflation results. See, economics is pretty simple when you strip out all the fancy words and replace them with good data :)
- stretchwithme 16y agoone interesting aspect of inflation/deflation is that neither moves through the economy uniformly. one market can be inflating even while another is deflating Right now, things are definitely deflating if looking at the whole. The loss of hundreds of billions in perceived value definitely removed some of the "currency" people thought was part of total buying power. The currency left over is naturally more valuable and price declines are the result.