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To: Jorj X Mckie who wrote (49)	12/15/2000 3:51:40 PM
From: John Pitera	Respond to of 111

No, I had some assistance -g- some of it was from an old word document. One of the Key variables in the creation of money is the Velocity or how quickly people turn it over. If someone gets 50,000 and immediately goes and spends it, say on a car, then that auto dealer has a cash inflow and can turn around and buy another car or spend the money. As the money flows through the system it creates a money Multiplier affect, When times get tight like the recession prior to the gulf war, people stop spending (buying cars and many purchases due to uncertainty and fear). So the velocity slows down and that impacts the economy and money supply. John