Jon my initial take is that M1 is too narrow in terms of it's components to broadly extrapolate too much. I believe it's the physical currency, the Central Bank holdings and then the demand accounts (checking, and current accounts)
and Hawk I am going to try to post some thoughts on the carry trade!!!!
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en.wikipedia.org
Because (in principle) money is anything that can be used in settlement of a debt, there are varying measures of money supply. The narrowest (i.e., most restrictive) measures count only those forms of money available for immediate transactions, while broader measures include money held as a store of value
[edit] United States
U.S. Money Supply from 1959-2006The most common measures are named M0 (narrowest), M1, M2, and M3. In the United States they are defined by the Federal Reserve as follows:
M0: The total of all physical currency, plus accounts at the central bank which can be exchanged for physical currency.
M1: M0 + the amount in demand accounts ("checking" or "current" accounts).
M2: M1 + most savings accounts, money market accounts, and certificate of deposit accounts (CDs) of under $100,000.
M3: M2 + all other CDs, deposits of eurodollars and repurchase agreements.
As of March 23, 2006, information regarding M3 will no longer be published by the Federal Reserve. The other three money supply measures will continue to be provided in detail. On March 7th, 2006, Congressman Ron Paul introduced H.R. 4892 in an effort to reverse this change.[2] |
