WM1NS trade ideas
Money Supply (M1) / GDP - 2M ChartMilton Friedman's Money-Supply Rule:
Growth of the Money Supply << Rate of Growth of Real GDP = Recession
--There is not enough money to buy what has been produced.
Growth of the Money Supply >> Rate of Growth of Real GDP = Inflation
--There is an abundance of money and not enough goods - prices will rise
Growth of the Money Supply == Rate of Growth of Real GDP = Equilibrium
Bottom Line:
We are entering a severe inflationary period. Prices have increased a lot over 90 years and should be seeing this trend continue.
--Gold, Silver, Commodities, Assets will continue to increase as long as the below remains true.
--The Feds have resorted to unlimited quantitative easing to fight a deflationary spiral that would cause mass bankruptcies, unemployment, and credit/ liquidity shortages.
--Negative Interest Rates Next?
Gold and Money Supply. Why Gold is a good long-term investment.Here we see the correlation of Gold (XAUUSD) and M1 (money supply composed of physical currency and coin, demand deposits etc). During the last two financial crises (DOTCOM and SUBPRIMES), the central bank raised the rates to support the stock market collapse and save the economy from recession.
As you see when rates were raised and money supply spiked, Gold started rising as well as a counter to inflation. Similarly, Gold has spiked since March 2020 when the Fed announced the trillion dollar rescue package to counter the shattered demand from the COVID lockdown.
In our opinion that makes Gold a necessity to any investor's portfolio on the long-term.
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M1 (Velocity of Money) 13:21:15 (UTC) Wed May 27, 2020The velocity of money is a measure of the number of times that the average unit of currency is used to purchase goods and services within a given time period. The concept relates the size of economic activity to a given money supply and the speed of money exchange is one of the variables that determine inflation.
Fed Prints Money to Fight COVID19: M1 and M2The chart shows the sharp increase in US "money supply: upon Senate approval of a $2 trillion coronavirus stimulus package
Money Supply: There are two definitions of money: M1 and M2 money supply. M1 money supply includes those monies that are very liquid such as cash, checkable (demand) deposits, and traveler’s checks M2 money supply is less liquid in nature and includes M1 plus savings and time deposits, certificates of deposits, and money market funds.
The Federal Open Market Committee (FOMC) and associated economic advisers meet regularly to assess the U.S. money supply and general economic condition. If it is determined if, and how much, new money needs to be created.
M1 Money Stock vs. S&P500: QE infinityBlue: M1 money stock. Contains liquid assets unlike M2
Black: S&P500 being artificially propped up by the federal reserve and its "large scale asset purchases" aka money printer.
Fed pumped the same amount from 84 to 08 and 08 till now.
Entire market is a bubble. Feds experiment is going to pop. Buy Bitcoin
Why Bitcoin Will Be Better Than GoldHello Everyone!!!
I am Donald David Dongalore!
Earlier in the day, I had promised that I would provide some remedial education! I am doing this because I believe that there is a lack of literacy, with regard to the cryptocurrency space, in the arena of monetary policy and the effect that meddling with a money supply can have!
To fully understand what is happening, it is imperitive to have a firm understanding of what is so called "hard money" vs "easy money"!
In the chart you can see that as far back as time will allow me to chart is the year of our LordAnneTaylor 1975. Unfortunately this does not allow for the accurate price analysis of Gold in comparison to the United States Dollar prior to thier decoupling by the great and glorious President Richard Nixon, who I'm told has established quite a reputation for watches and sunglasses! How exciting!
The interesting item that I believe I have uncovered here is that when you scale the 21st Century Fox (TM) digital gold i.e. BTC to the origin of decoupling "hard money", we can see that what was once an asset which had appeared to be manipulated through paper (XAU) has done nothing more but grow in value on a consistent basis when compared to the now "easy money" generated by what can be presumed to be the "easy money" powerhouse of the world!
It is interesting to note that this powerhouse of "easy money" no longer enjoys the same prosperity that it once had while following the economics of "hard money" and has since laden its populace with reckless amounts of debt! How enjoyable it must be to live there!
BTC which is growing ever more scarce and difficult to obtain, shares many properties with XAU but has many more features which make it incredibly useful!
Don't invest in "easy money"! It will make you poor!
I don't give advice, but if I did, it would be good.
Money Printing. WOW. Monthly log chart dating back to 1976. Parabolic in 2012 to say the minimum. How this recession plays out is beyond me. Something has to give. Based on my other charts, a pretty picture is not depicted. Clearly all that excess money supply is in financial assets. Makes sense that as soon as corporations experience an earnings recession while at the same time, having to roll over debt at the higher rates, money left over for share buybacks will not be plenty. What buyers will stand ready to make up for that decrease in demand, is unclear.
M1 = BTC priceM1 indirectly says,
"BTC will continuously go upwards as long as the government prints out their money."
