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| I think that computer is starting to figure it out with that M2 money supply graph. Debt expansion has been accelerating in recent years while the M2 money supply (savings) is not matching pace. Which is the nature of debt expansion. Each time the debt is expanded to increase the currency in circulation, then the debt has be be expanded to an even larger degree to get the same effect, ie growth in savings.
I did notice the computer did not look at whether house prices have any correlation at all to cheap debt. That was the original question posed there in the copy and paste about whether massive debt expansion is inflationary. What happened to land and house prices after 2009, and what happened to debt expansion.
Has the computer figured out that you can take out debt and then put 10% of those funds in your saving account so increase M2 that 10%. And debt 90%.
Compare M2 to the attached picture. Yes, you can massively expand debt without a significant impact on M2. Does that mean assets have stopped inflating over last 10 years.
And once the debt stops expanding, is the M2 going to keep increasing?
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US GDP Stagnant – Q1 2025
