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The Hockey Stick Rise in M1 is a Monetary Statistical Mirage

Huge Monetary RiskEarlier today I posed a Q&A what if on QE: What Would Happen to Inflation If the Fed Announced Trillion a Month in QE?My conclusion was not even a further quadrillion in M1 via QE would matter.I just added a couple of paragraphs to the post that are themselves worthy of a monetary spotlight update.Please recall my August 18, 2020 post Bond Bull Lacy Hunt Warns of a Huge Monetary Risk (emphasis mine). LH: When the Fed initiated QE1, QE2 and QE3, folks said those policies were very inflationary. There is a liquidity effect of what the Fed is doing, and the liquidity effect can be very powerful over the short term. But ultimately the increase in the money supply did not follow through after the rounds of Fed purchases of government securities because the banks couldn’t

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The Hockey Stick Rise in M1 is a Monetary Statistical Mirage
Mike Shedlock
Mike Shedlock (Mish) is a registered investment advisor representative for SitkaPacific Capital Management ( Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.

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