The Truth About Money


April 1, 2020

If you were ever fortunate to hang out with William Blount aka WB within about an hour to two hours he would have told you to go over to the Saint Louis Fed and pull up a velocity M1 money supply chart. That will give you a true report card on how the current administration is doing.

Now I'm not an economist or a financial scholar with a Magna Cumme Laude? but what WB said made a lot of sense. Not that I know one but I do know a rocket scientist and a jet propulsion girl (and I got some distinct kin on the space program).

The best handle I can get is the velocity of money is the frequency where one dollar is used to buy stuff made here within a given time. The number of times one dollar is spent to buy goods and services in a set unit of time. If the velocity of money is increasing, then more transactions are occurring between folks in the current reality.

  • Provides insight into whether consumers and businesses are saving or spending.
  • M1 is the money supply of currenty (1, 5, 10, 20 and benjimans), notes and coins, traveler's checks
  • Monentarist argue a stable demand for moeny as a function of income and interest rates.
  • A stable relationship between the velocity of money and a normal interest rate---short term T bills.
  • V = (PY)/M where V is velocity, P is Price Level, Y is real output, and M is measure of the money stock.

From FRED Economic Research St. Louis When you click on it also check out the M2 it's an every more sliperly slope!

Now like I said I do not build rockets for a living I trade for a living so take this for what it worth. You can not carry more than $250 in your picket for insurance if you expect to be reimbursed for your loss. And most folks pay with a credit card or with their smartphone bill pay. So, it seems to me that a graph is going to be on a constant slippery slope? The use of currency is slipping by attrition.

Then factor in the inability to make large depots of cash in a US Bank or else you get put on a SCARS list for Sumurfing in this current reality and then on the to next! So what are those bean counters in touch with this reality?

I'm just a trader--in the world but if you want to speak to an economist or at least read a thesis on the "Liquidy", Monetary Policy and the Financial Crisis: A New Monetarist Approach" the check out:

Stephen D. Williamson the Vice President of Research Division Federal Reserve Bank of St. Louis. And when you are through perusing than you can download the full brief at American Economic Association. Ok in the argument above I forgot to add the bitcoin which you now can add to your IRA.

About The Blogger

I'm just a regular guy; Not Silver spoon family or WALL Street / Chicago network or Financial Fast Track educational express superstar golden boy, I have an intimate knowledge of the insider mindset / how the insiders on Wall Street think act and position their trades.

I SEE THE MARKET IN TERMS OF THE COMPOSITE MAN / INSIDER – Most traders look at the market in terms of bulls and bears. This creates a dichotomy. A duality of the mind. Wyckoff looked at the market in terms of Composite Man / “insiders” the combined effect of the bulls and bears. It's the insiders that move the market in terms of news catalysts and offing events---not bulls and bears. I've cloned the mind / vernacular of Wyckoff's thinking and writing approach to the market.

Related Books / Videos

Jamual Swan
55 hours ago

Wyckoff do you think bitcon will be the new currencty of the future?

Wyckoff Trader to Jamual
89 hours ago

Well Jamual the two words new and future---they are already here? When I was in my 20's they would say; "Wow you getting into computers? I hear one day their will be a computer in every home? I'd say yes their will be and more and I want to be a part of it!"

Check out where I briefly say in 3 years 2020 their will be 30 billion internet connected devices.

The truth about money is that money or currency was used the hedge against to possible or potentialality of nations going to war against each other. With bitcom being the world currency simply becuase it does not have a phycisal boundry it is already the world currency. Did you know you can use bitcoins to put in your IRA? Did you know that CME has a pattent to start using futures to hedge against the bit coin? I'm working on a future blog. SO maybe, the future is here---we just don't know it?

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