Today, I calculated the "M1 multiplier," i.e., the ratio of the amount of checkable bank deposits and currency in circulation to the "high powered money stock" (currency + bank reserves). This measures credit creation by banks based on fiat money (money made by the Fed, with the government's backing).
What's weird is that in December 2008 and January & February 2009, this number has been less than one (0.98, 0.92, and 0.98). That's a sign that commercial banks are refusing to lend. The increase from January to February is a sign that there's a glimmer of financial recovery. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
