Wednesday, October 17, 2012

Available Credit

Here's what's been happening to the M2 money supply times the Velocity of money divided by the number of adults in the population.
The blue line is CPI-U. Available money has grown 3x inflation. That's why assets and commodities have exploded. Beating inflation doesn't cut it when you can be outbid 3:1 by cheap credit. And let us not fool ourselves into thinking access to that explosion in credit is distributed anywhere close to evenly.

7 comments:

TJandTheBear said...

Wonder how close to that red line oil would track.

Rob Dawg said...

http://research.stlouisfed.org/fred2/graph/?graph_id=93257&category_id=0

Interesting.

Thomas Stone said...

This site is bookmarked again. Dawg, sorry you felt the need to stop spending time at HCN, but the amount of abuse you got would discourage most.

Rob Dawg said...

The strangest thing is if I were a racist it wouldn't bother me. If -yogi weren't a racist he wouldn't act like that.

Then there was the post editing and denial when caught. And don't even get me started on the crap KP thought was acceptable that no one saw fit to call him him on.

Best to move on.

My aunt stayed two days in Sonoma. She's in love with the region.

TJandTheBear said...

Damn straight, Dawg -- lunatics like KP are immune to any form of logic. Ever notice he doesn't post at night? I'm sure that's because the asylum has a curfew on internet privileges.

I've just gotten to the point where I won't respond to a single thing certain posters spew forth on CR.

Thanks for the chart, BTW. Oil shows a fascinating tug-and-pull between money printing and demand destruction.

Rob Dawg said...

I remain embarrassed to this day at how long it took for me to realize adornosghost was actually serious about his climate alarmism.

TJandTheBear said...

Let'em bear their crosses.