it's important to know the difference between M1, M2, M3 etc. https://t.co/o1Xand3Q0Q
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2/ M1 is literal paper bills and coins. M2 is that plus checking and bank accts. M3 is that plus certificates of deposit M1 has gone up by a lot, M2 hasn't changed nearly as much in percentage termspic.twitter.com/CQDa01N58F
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ⓘ Dogs don't have thumbs Retweeted Fla Mom (Gab Fla_Mom; Parler FlaMom)
3/ meh, this is goldbug territory, where I do not tread gold, btw, is only INHERENTLY useful to plate electrical contacts and to sputter deposit on spacesuit helmets lathes, cars, backhoes, cube farms, elevators, and AC units are inherently useful >>>https://twitter.com/Fla_Mom/status/1340015006935642112 …
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4/ and you can come up with a value for those things if you want ; google "net worth of ___", e.g.https://en.wikipedia.org/wiki/Financial_position_of_the_United_States#Net_worth_(or_equity) …
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5/ but you don't want to call that Mx, for any x, because the M stands for MONEY and that tells us that what we're specifically interested in is units of exchange, NOT units of productivity.
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6/ and if the topic is inflation (as it almost always is, if someone is upset about M1 or M2), then we specifically want to call out M as DISTINCT from the things of real value, bc it's the change in the ratio of those two that's suggestive of inflation
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7/ but anyway, getting back to the top of the thread: M1 shooting up an important thing to think about is where is that cash going? A very large percent of US currency circulates overseas (something like 40%, IRRC). But that's on average. Given craziness worldwide, I could
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8/ imagine that households in the PRC are more interested in hoarding gold and US dollars than before. So of the NEW M1 that's been printed recently, is 40% going overseas ... or is it higher? 80% wouldn't surprise me.
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9/ On a tangent, seignorage (USG ability to turn worthless ink and paper into $$$$) is amazing. 40% of $6T in currency is overseas, or ~$2T what a glorious scam - foreigners purchased that paper with $2T of REAL THINGS. [ not really a scam, of course ; USN pays those checks ]
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Replying to @MorlockP
Speaking of which https://www.bis.org/publ/cgfs65.htm
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