US Money Supply – December 2010

posted by Nima

January 19, 2011 · Posted in Monetary Economics 

The true money supply in December 2010 has grown to $2,345 billion, the annual growth rate has gone up to 5%.



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7 Responses to “US Money Supply – December 2010”

  1. Johnathan Stein on January 20th, 2011 5:10 am

    What is the data source for “True Money Supply”? You credited but a search there doesn’t turn it up.

  2. Nima on January 20th, 2011 9:27 am
  3. scott t on January 20th, 2011 11:53 am has several charts of various M figures.

    whether they are true or not i dont know.

  4. Johnathan Stein on January 20th, 2011 2:52 pm

    If I’ve done this right, then 2370.8 is the TMS figure for Dec-10, not including “sweeps”. The TMS for Nov-10 would be 2296.5 plus a sweeps of 802.4 would be 3098.9, much higher than your graph shows.

  5. Nima on January 20th, 2011 6:07 pm

    Here’s my composition for Dec 2010:

    Cash 920.2
    +DemandDeposits 536.6
    +Govt. Deposits at Comm. Banks 1
    +Govt. Deposits at Federal Reserve 60.3
    +Government Note Balances at Depositories 2
    +Retail Sweeps (est.) 802.4
    +Demand Deposits (Foreign BANKS) 15.5
    +Demand Deposits(Foreign INSTITUTIONS) 7.8

    =True Money Supply: 2345.80

  6. Johnathan Stein on January 20th, 2011 6:27 pm

    OK, I get the same, assuming you’ve used November’s SWEEPS data for Dec-10.

    One thing I do not understand: Why do you not include “Supplementary financing account”?

  7. Nima on January 20th, 2011 8:07 pm

    Well, that’s a tricky one.

    I wrote about this a while back

    Based on how this program works it seems like the Treasury simply helped expand the balance sheet of the Fed by withdrawing money from the economy.

    This money at the fed is not used for anything unless it is extended to banks or used to buy assets … which in turn would show up on checking accounts which we are already counting.

    I don’t include any of the reserve money at the federal reserve in the true money supply either. In fact, none of the traditional measures even do that. So I see no point doing that, because that money is out of circulation as far as I understand it.

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