VGSH - Monetary Conditions Are Returning To Normal
2024-06-28 05:40:00 ET
Summary
- Today, the economy is once again functioning normally, growing at about a 2% pace.
- The big inflation episode is essentially over, but the Fed is once again slow to figure this out, and thus reluctant to lower interest rates.
- Currency is a good proxy for money demand since people only hold currency if they want to - unwanted currency quickly finds its way back to the bank system to be exchanged for interest-bearing deposits.
On June 25th, the Fed released the May '24 data for M2 (the release is scheduled for the fourth Tuesday of each month for the previous month's data). There were no surprises....
Monetary Conditions Are Returning To Normal