> GDP is calculated from supply and velocity, not the other way around, yeah? No. Your graph shows that the Fed only starting to unwind their balance sheets i

> GDP is calculated from supply and velocity, not the other way around, yeah? No. Your graph shows that the Fed only starting to unwind their balance sheets in 2018. Why was the Velocity of Money dropping during a boom phase? It's because it's calculated like I said. Our trade deficits force us to take our greater and greater amounts of debt. During recessions - where people and companies are unable to take out the debt - the government is forced to back us. The growth of GDP has been constantly dropping because our economy has been keeping alive more and more zombie companies. Many of these companies are taking out debt, and funneling that debt directly back into their stock through buybacks. These buybacks increase the demand of their stock and reduce the supply, which raises prices, which raises their market cap, which allows them to take out more debt! Since their market cap has risen, Vanguard and Blackrock and all of the other index funds are now forced to buy more, which pushes even more demand to these stocks. With the growth of debt, the Fed can now unwind their balance sheets. The cycle continues...