2 ms·
To verify, though: in fact, the M2 is skyrocketing in 2020, right?
by saurik 6y ago
To verify, though: in fact, the M2 is skyrocketing in 2020, right?
- findthewords 6y agoYes, but velocity of money is plummeting.
- dlubarov 6y agoIs there reason to think that velocity will remain low in the long term, though? If it's just temporary economic effects caused by COVID (e.g. less physical commerce), then surely we will see higher inflation as those effects go away?
- dragonwriter 6y ago> Is there reason to think that velocity will remain low in the long term, though? There's reason to believe that as velocity rebounds, ceteris paribus, monetary policy will tighten to avoid rapid inflation. Congress may leave fiscal policy on autopilot all too often, but you aren't likely to find the Fed completely asleep at the monetary policy wheel.
- erooijak 6y agoYes. See https://fred.stlouisfed.org/series/M2 https://fred.stlouisfed.org/series/M2. In 2020 the M2 Money Supply increased with 25%.