True to a large degree, or at least it should be, but more likely is that oil prices are rising in anticipation of supply issues given the atrocious policies of the new government, and so far that is the biggest driver of inflation across the board. Pent up. demand is also going to be an issue, of course, especially y/y given the almost zero demand for travel twelve months ago. But once again, in the last twenty years it doesn't seem like the velocity of money has really changed much, yet the supply has increased immensely, and we don't yet see the corresponding inflation we should, so reducing it to a single factor this month seems unwise.
So yes, you are right. But the fed number for the velocity of money is GDP/M2, so it just finishes the equation V=PT/M where PT=GDP. So it isn't something measured independently. I was certainly sloppy with my words there. What I was referring to was that it doesn't appear that other things that determine what we perceive as the velocity of money, like savings rate etc, aggregate demand, etc have changed much over time, which is the conundrum I consistently allude to.I'm going to challenge your statement that "in the last twenty years it doesn't seem like the velocity of money has really changed much":
View attachment 7604195
Looks to me like it's dropped substantially over that timeframe. The drop just in the past year alone was huge. That's why adding 30% to the money supply in the past year/month/day/nanosecond doesn't spark inflation.
What's the number I heard in the radio last week - something like 60% of all stimulus money got parked in savings accounts? I don't know if I'm recalling this correctly (or if it was properly stated), but it plays into this overall theme that has hampered recovery since 2009 - those who are net savers aren't spending money, and those who are in debt cannot afford to add any more debt. There are obvious exceptions to this in the current market - plenty of money is being spent on houses and pickup trucks - but overall, that represents relatively few participants in the economy. Kinda tough to juice up the economy when less than 10% of the population can afford to engage in commerce beyond the bare necessities.
And with that, we've way overshot the boundaries of expected discourse in this thread
I know a liberal, he said he voted for Trump when I was pointing out what a psychopathic liar Hillary was in 2016, but he keeps his TV remote J&B Welded to CNN 14 hours a day.classic
Max 3 shells, legal time stops 30 min after sunset and driving to a foot locker parking lot would be hunting over bait.
www.thegatewaypundit.com
www.rasmussenreports.com
amgreatness.com
www.eviemagazine.com
voterintegrityproject.com
www.thegatewaypundit.com
I should have told him his 3 shell max was plenty if he followed his candidate Biden's advise and just stepped out on the porch and shot of couple blasts in the air.
She's got that 1000 cock stare.
justthenews.com
Right, so what we are saying is that the propensity to spend has gone from 96.5% down to 93%, roughly, over that time period. When viewed from that angle, the change is much less significant, and it is the spending side that we would expect to look like the velocity of money, at least intuitively, to some degree. Meanwhile, M2 has gone from roughly 7 to 20, or almost tripling. All I am saying is that inflation, either measurable or perceived, doesn't really look like that scenario describes.
Question is, are you willing to find the answer, or stick it out to fix what you can?
