Money Supply Graph Update for July
After yesterday’s pre-holiday bad news dump from the FDIC,* I thought it wise to check back for a July update on the St. Louis Fed’s money supply graph. (June’s update was prompted by a story in the Wall Street Journal.)
Here’s the skyrocket:
This sort of firecracker should be outlawed ahead of bottle rockets, cherry bombs and hand grenades. It’ll cause more harm than all the poppers shot off across the country for the next fifty years.
The good news from the data is that the money supply is down to $1.6 trillion from its all time high of $1.8 trillion.
The bad news is that the huge spike did nothing — or next to nothing — to turn the economy around. (See yesterday’s unemployment statistics for a strong argument against “green shoots” sprouting in the economy.)
There are two possible outcomes.
The money supply could maintain its high level. That means explosive inflation.
The money supply could drop faster than that Airbus that crashed into the Atlantic like a brick.
Both outcomes call for prolonged period of picking up the economic pieces.
(No, I don’t see a soft landing — especially should Democrats succeed in pushing through Cap’n Trade, Obamacare or another so-called stimulus. I will cheerfully admit error if events prove me wrong.)
* Seven bank failures: 6 in Illinois and 1 in Texas. What’s going on in Illinois?
- Winchester is in southwest Illinois, just south of Interstate 72 and north of St. Louis.
- Clinton is on the far side of Springfield from Winchester. Using Springfield as the center of a clock face, Winchester is between 8 and 9 o’clock, while Clinton is about 2 o’clock.
- Oregon is at the northern end of the state, northwest of the junction of Interstate 39 and Interstate 88.
- Elizabeth is in the northwest corner, on the bump of Iowa’s nose.
- Danville is on the eastern border with Indiana, is the only free-standing town of any real size on the list and the only one that I had heard of before yesterday.
- Worth is part of suburban Chicagoland, southwest of the metro area, next to Interstate 294.








