Money is changing hands at an historically slow rate. The...
Money is changing hands at an historically slow rate.
The velocity of money, called M2V, is the lowest it has been since 1958. The red line on this graph from the Federal Reserve of St. Louis is my own definition of low velocity. Data below that mark appears to be sluggish movement of each dollar through our economy.
The stock market may have made a new high, but this low velocity suggests that we are a long way from a recession that would cause a market decline. Chart source: http://research.stlouisfed.org/fred2/series/M2V/Buy Timing the Market at Amazon.com
The velocity of money, called M2V, is the lowest it has been since 1958. The red line on this graph from the Federal Reserve of St. Louis is my own definition of low velocity. Data below that mark appears to be sluggish movement of each dollar through our economy.
The stock market may have made a new high, but this low velocity suggests that we are a long way from a recession that would cause a market decline. Chart source: http://research.stlouisfed.org/fred2/series/M2V/Buy Timing the Market at Amazon.com
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