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re: Fed hides weekly M1 supply, says "money doesn't matter"

Posted on 5/5/21 at 11:03 am to
Posted by RedStickBR
Member since Sep 2009
14577 posts
Posted on 5/5/21 at 11:03 am to
quote:

So the fed is simply betting velocity wont increase? Seems like a risky bet, considering how much cash has been added in the last year.


The increase in money supply is meant to offset the dramatic decline in velocity. The Fed is terrified we slip into deflation.
Posted by rocket31
Member since Jan 2008
41819 posts
Posted on 5/5/21 at 11:37 am to
quote:

The Fed is terrified we slip into deflation.


they literally just said they are potentially raising rates to increase deflationary pressure

if that happens prices would fall and then the cash-rich can pick up discounted assets

if rising prices (especially for food) continue etc cause a breaking point, the majority will welcome deflation
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