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Strategies & Market Trends : Ride the Tiger with CD

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To: Amark$p who wrote (184340)2/28/2010 9:30:59 PM
From: GoldBull no bug here  Read Replies (1) of 312793
 
from Muldin at Goldseek - a negative on the money multiplier -
(rocking my boat a little, gotta think about this...chart doesn't post)

"There has been no money multiplier. In fact, the money multiplier, as measured by the ratio of MO to M1 growth is at its lowest level ever. Look at the graph below:

What this graph shows, astonishingly, is that a dollar added to the monetary base now has a NEGATIVE multiplier effect. Without showing yet another chart, bank lending has fallen percentagewise the most in 67 years. The actual amount of bank loans is falling each and every quarter, with no signs of a bottom. Consumers are reducing their debt and leverage. Bank loans are being written off at staggering rates. Over 700 banks (I think that is the figure I saw) are officially on watch by the FDIC, with more banks being closed each week."
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