10/25/12

Question

The monetary base is declinng since June. This development has happened very rarely in our history. Is the Fed too tight? Why?

The monetary base should be growing (roughly) at the same pace as the economy.

DEFINITION OF MONETARY BASE - The total amount of a currency that is either circulated in the hands of the public or in the commercial bank deposits held in the central bank's reserves. This measure of the money supply typically only includes the most liquid currencies.

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

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