Tuesday, December 10, 2013

Total Debt (Credit Market Instruments) Vs Money Supply

Chart of total credit market instruments (i.e. total debt) versus M2 money supply [link].

Here's what the ratio looks like. Here's what the ratio of total debt to M1 money looks like.
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2 comments:

  1. AnonymousDecember 11, 2013 at 12:52 PM

    It would be really good to look at global data (to see the effects of so many QE monetary policies -- in the US, UK, EU, JPN, etc.).

    The ratio charts do show a sharp "de-leveraging" in the US, which (if you dig into data) is mostly sophisticated investors winding down SPV/SPEs and the like.

    A question worth asking is: why are credit market instruments growing in a de-leveraging environment?

    ReplyDelete
  2. CPDecember 11, 2013 at 12:54 PM

    Feel free to do the analysis, and I'll post it.

    And thanks for engaging with the post.

    ReplyDelete