M1 Money Supply vs. Real GDP

Tuesday, September 17, 2013
Here are a few interesting charts of M1 money supply vs. Real GDP/10 from reader WendyBG.

Data

M1 consists of: (1) currency outside the U.S. Treasury, Federal reserve Banks, and the vaults of depository institutions; (2) traveler's checks of nonbank issuers; (3) demand deposits; and (4) other checkable deposits (OCDs), which consist primarily of negotiable order of withdrawal (NOW) accounts at depository institutions and credit union share draft accounts.

Click on any chart to see a sharper image.

M1 vs. Real GDP/10 1959-Present




M1 vs. Real GDP/10 2000-Present



M1 vs. Annualized Change in Real GDP



The third chart shows annualized change in GDP vs. M1.

Increases in M1 no longer have the same effect on growth or jobs.

M1 as Percentage of GDP



M1 money supply has increased under Bernanke at a faster pace than ever before relative to GDP.

I will take a look at GDP vs. other money supply measures later this week.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com