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MV=PQ is popular in some circles, but it doesn't describe casual links. You can't reason about how those quantities behave from the equation, which is a mere a
by atq2119 6y ago
MV=PQ is popular in some circles, but it doesn't describe casual links.
You can't reason about how those quantities behave from the equation, which is a mere accounting tautology.
Both recently and in QE post-global financial crisis, V went down because M increased without any reason for why the right-hand side of the equation should change.
- marcosdumay 6y ago> V went down because M increased without any reason Wait, if we are talking about 2017-2019, that's a different story. But right now, V got to the floor (everywhere, not just the US) because of the pandemic.