Reliquification at its finest.......
<Recognizing that "money" is created through the lending
process, there is certainly no mystery behind the continued
historic monetary expansion. The Great Credit Bubble runs
unabated, with broad money supply (M3) expanding by almost
$41 billion last week ($68 billion during the past two weeks).
Broad money has surged a stunning (even if this is the "same
old story," it remains "stunning" nonetheless!) $249 billion
over the past 10 weeks, an annualized growth rate of 18%.
Since the end of October - in what has been 29 weeks of
unrelenting "reliquefication" - M3 has jumped $614 billion, a
16% annualized growth rate. This expansion is not limited to
"broad money" components, with M2 growing at an
annualized 11% rate over the past 29 weeks. By major
category, currency outstanding has increased (since October
30th) $18 billion, or at a rate of 6%. Checkable deposits have
actually contracted $11 billion, an annualized 4% rate of
decline (M1 has increased only $4 billion since October 30th).
Savings and small time deposits have increased $216 billion, a
14% rate, while retail money market fund assets have added
$67 billion, growing at a rate of 13%. Of the broad money
components, "repurchase agreements" have declined $8
billion, while "eurodollars" have increased $21 billion, or 19%
annualized. Leading the monetary charge, institutional money
market fund assets have surged $248 billion, or at an
annualized rate of 61%. As discussed repeatedly in previous
commentaries, the powerful deposit creating capability of
money market fund intermediation is at the heart of the
unprecedented GSE and Wall Street-led money and Credit
Bubble. >
prudentbear.com |
