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Strategies & Market Trends : ahhaha's ahs

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To: frankw1900 who wrote (24235)12/30/2013 8:53:12 PM
From: ahhahaRead Replies (2) of 24758
 
Folk can't do business if they can't get cash.

I thought we had a capitalist economy.

I think letting cash supply growth consistently track economic growth would be fairly straightforward thing to do.

There's no a priori causality between the two, and therefore, no reliable connection. Greenspan's FED proved this to be true within Friedman's requirements between 1988 and 1991 when FED allowed M2 to grow however it would.

Am I wrong?

Yes.

Is it difficult?

Extremely, because you have to get away from most contemporary economic thinking, none of which works, to understand why. Consider. The US M2 money supply has been growing at 7% for a long time yet GDP has had a hard time breaking 2% until last month. Over the last 80 years the lag has been a max of 6 months. How do you explain a lag of 46 months? The only possible way within monetary concepts is to claim huge slack, but then, if folk get cash, they still can't do biz, because they fear the risk under the Kyng.
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