Can Someone Explain This?

Discussion in 'Economy' started by Annie, Jul 21, 2011.

  1. Annie
    Offline

    Annie Diamond Member

    Joined:
    Nov 22, 2003
    Messages:
    50,847
    Thanks Received:
    4,644
    Trophy Points:
    1,790
    Ratings:
    +4,770
    Following Third Largest Weekly Surge In M2, Expect Artificial Spike In Leading Economic Indicators | zero hedge

    Lots of charts, but what does it mean?
     
  2. Baruch Menachem
    Offline

    Baruch Menachem '

    Joined:
    Sep 12, 2008
    Messages:
    14,204
    Thanks Received:
    3,235
    Trophy Points:
    185
    Ratings:
    +3,305
    M2 is high power money, and money supply is a indicator of economic growth. The economy in keynsian terms is explained as money in circulation times the velocity of money is equal to all the prices in the economy times all the quantities of goods and services sold in the economy.

    What he is saying is that the money supply has suddenly increased, which means that the computers on wall street wil assume economic production has also increased.

    Alternatively, it could just mean that prices are getting ready to skyrocket. the next set of statistics will show either we are ready for a new boom in inflation or real economic growth. But he is arguing that what is actually happening is that money is just being shuffled without any real increase in the money supply or economic activity. Which means he is predicting more stagflation.
     
    • Thank You! Thank You! x 3
  3. MeBelle
    Offline

    MeBelle Mebellien Mothership © Supporting Member

    Joined:
    Jul 16, 2011
    Messages:
    15,003
    Thanks Received:
    5,342
    Trophy Points:
    340
    Ratings:
    +6,151
    Excellent response!
     
  4. Annie
    Offline

    Annie Diamond Member

    Joined:
    Nov 22, 2003
    Messages:
    50,847
    Thanks Received:
    4,644
    Trophy Points:
    1,790
    Ratings:
    +4,770
    So manipulation of reporting is going on? Why? To what ends and by whom?
     
  5. Trajan
    Offline

    Trajan conscientia mille testes

    Joined:
    Jun 17, 2010
    Messages:
    29,048
    Thanks Received:
    4,751
    Trophy Points:
    48
    Location:
    The Bay Area Soviet
    Ratings:
    +4,756

    Annie, seriously? ;)

    Bernbank (bernanake) for one and anyone who has stake in making it appear that there is a 'recovery' or anyone who wants to attmept to goose so they don't have to enact QE 3 (which will put inflation thru the roof in an election year;))
     
    • Thank You! Thank You! x 1
  6. Annie
    Offline

    Annie Diamond Member

    Joined:
    Nov 22, 2003
    Messages:
    50,847
    Thanks Received:
    4,644
    Trophy Points:
    1,790
    Ratings:
    +4,770
    I figured it might be something like that, still would like to hear the analysis from someone in the field.
     
  7. Trajan
    Offline

    Trajan conscientia mille testes

    Joined:
    Jun 17, 2010
    Messages:
    29,048
    Thanks Received:
    4,751
    Trophy Points:
    48
    Location:
    The Bay Area Soviet
    Ratings:
    +4,756

    no problem cupcake ;)

    [ame=http://www.youtube.com/watch?v=dOOTKA0aGI0]‪Dennis The Constitutional Peasant‬‏ - YouTube[/ame]
     
    • Thank You! Thank You! x 1
  8. Spoonman
    Offline

    Spoonman Gold Member

    Joined:
    Jul 15, 2010
    Messages:
    18,142
    Thanks Received:
    5,544
    Trophy Points:
    330
    Ratings:
    +5,748
    it means someone is expecting the economy to take a noticable downturn and is looking to artificially prop it up. it's like a botox injection for the economy.
     
    • Thank You! Thank You! x 1
  9. Annie
    Offline

    Annie Diamond Member

    Joined:
    Nov 22, 2003
    Messages:
    50,847
    Thanks Received:
    4,644
    Trophy Points:
    1,790
    Ratings:
    +4,770
    Yeah. Trajan, yourself, and I see it the same way. I wonder though if Toro or other investors/economic major types could find any other explanation or reasons the writer got it wrong?
     
  10. Baruch Menachem
    Offline

    Baruch Menachem '

    Joined:
    Sep 12, 2008
    Messages:
    14,204
    Thanks Received:
    3,235
    Trophy Points:
    185
    Ratings:
    +3,305
    I think Toro has been beating this drum for a long time.
     

Share This Page