Steven, thank you for the great report this was an amazing weekend read. I have a question on Money Supply and Bank Credit: loan growth and and commercial bank deposits seem to be a lagging indicator based on all of the FRED charts. Wouldn’t the the decline in loans and M2 that were seen recently imply that the US entered a technical recession in late ‘22/early ‘23? Looking forward to your response!
Steven, thank you for the great report this was an amazing weekend read. I have a question on Money Supply and Bank Credit: loan growth and and commercial bank deposits seem to be a lagging indicator based on all of the FRED charts. Wouldn’t the the decline in loans and M2 that were seen recently imply that the US entered a technical recession in late ‘22/early ‘23? Looking forward to your response!
Thank you, Nate - I'm glad that you enjoyed it!
I would say that it increases the odds of a recession occurring, but that it doesn't in and of itself, mean that a recession has occurred.
For more information on the relationship between the real M2 money supply and GDP, please see this previous report: https://www.economicsuncoveredresearch.com/p/an-inversion-of-m2-and-the-cpi
Great insight!
Thank you!