Monogramming the Financial Crisis

I know it’s in the Obama Administration’s interest to emphasize how bad the economy was at the end of the Bush Administration.  But I think this goes too far.

The answer is in the money supply, as is so often the case.  If you look at the St. Louis Fed’s chart of the monetary base, and focus on the period since Inauguration Day, you’ll see that those clever Obama people appear to have manipulated the money supply so as to monogram the financial crisis with a telltale “W”.

Harrumph.  I thought we were going to see an end to such partisan fingerpointing.  This looks like the same old Washington blame game, and I’m disappointed.


3 Responses to “Monogramming the Financial Crisis”

  1. David Fitzgerald Says:

    Wow, that’s some chart. I’m no economics guru and even less a maths guy, but I can’t help think that things must be really bad to have an uptick like that and no inflation.

    I stand ready for all the, “the other shoe will soon drop, just you wait” comments that are sure to follow.

    • Mark Grannis Says:

      No need to brace yourself for the response, Fitz. It’s MV=Py. If I understand the equation correctly, with V falling it is theoretically possible for the government to expand M just the right amount and avoid inflation. It has never happened that way in the past, but I haven’t the slightest objection if you want to believe this will be the first time.

  2. [Name Withheld by Request] Says:

    But, if so, PLEASE prepare, at least a little, for the possibility that you are wrong!!!

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