The Money Supply (Monetary Base, M1 and M2) Defined & Explained in One Minute
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- เผยแพร่เมื่อ 17 ก.ค. 2018
- There's just so much confusion surrounding the money supply that it isn't even funny. What's the monetary base? What are M1 and M2? What's the difference between the money supply and the monetary base?
... the list could go on and on.
Today, I've taken things one step at a time by initially defining and explaining the money supply. I've then moved on to the definition and explanation of the monetary base, of M1 as well as M2.
Finally, I did my best to help people figure out how to interpret central banking decisions and outcomes through a proper understanding of the monetary supply. For example, the effects of QE on the monetary base compared to its effects on M1 and, finally, its effects on M2.
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Listen to it at 0.75 speed.
:D
HAHAHA ME TOO
that's what i did :D
🤣
Same
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At the year 2013 was discovered The Progressive Growth of Money Supply Principle, which say you how the Money Supply must growth, i.e., the quantity of money that market needs: th-cam.com/video/iiKr-i022mY/w-d-xo.html If we increase the money supply by an amount equal to the sum of interest generated by the financial system during the preceding period, the market interest rate will be the natural interest (Wicksell) Thanks to the Progressive Growth of the Money Supply Principle we know today that it is impossible to return to the Gold Standard. The Principle will force Central Banks to change de monetary policies.
Talk slower. Goddamn.
"good luck with that" this aged well.
:D
Sept 2022 😵
I for one appreciate the fast pace and short duration. Good job!
Always love hearing (well, reading) that, thanks a lot! :)
yes it is perfect that way ^^
One Minute Economics: "Goodluck with That", US Government: "Challenge accepted"
:D
Good stuff my friend :)
Nice try, but so many vague new words are added ghat i didn’t lesrn anything
Nicely explained.
dude you dont need to rap. This is economics not rap god
:))
@@OneMinuteEconomics dude i have 30s til my FRQs your rapping saved me I love you
Considering the recent plans in many countries those last few words hit hard!
We're living in "unprecedented" times, this much is certain
Upload more like This my economics exams is next week so please upload
One of the rare videos that actually gets money supply and inflation. To this day people think this is wrong despite 60 years of data supporting it and one data point that feeds the narrative of the uninformed.
Glad you liked it :)
What an elegant way to say, "People are stupid and dont understand inflation" lol.
This video certainly aged well.
:D
Nice! Thank you
i feel like there should be an update to this video considering the widespread and crushing inflation we are all experiencing.
Still doing my best to publish as frequently as life permits, be sure to check out my recent stuff when you get a chance to :)
try making it 2-minute economics for slower speed
I do my best to optimize things speed-wise, sometimes more successfully and other times less so haha. Still, as long as you can say the length out loud by starting with "one minute", I'm comfortable format-wise and can go up to one minute and fifty-nine seconds :)
Which one of these affects the cost of goods (fuel, groceries, etc...)?
All of them, if by that you are referring to the ability to purchase goods. A $100 bill kept in your family under the mattress for generations (poor matress!) has the same purchasing power than $100 via credit cards. If however you are referring to which increases are correlated to inflation actually going up, then the broader ones would fit that description. For a long time, the monetary base went up yet inflation was nowhere to be seen, because banks were hoarding reserves rather than eager to lend money out (and it wasn't like consumers were overly exuberant either) :)
@@OneMinuteEconomics No where to be seen? The CPI is fraudulent and it also did go up just a little each year. Also the reason it hasn’t run away yet is the fact that so many nations use our dollars. If or when that ceases these type of monetary expansions will be impossible.
@@OneMinuteEconomics it’s reflecting in assets price eg houses equity btc etc
Would you suggest bitcoin to hedge against inflation created by the federal reserve? If not, what can we use to hedge against inflation?
Bitcoin prices are known to be wildly volatile that most would suggest the USD to hedge against Bitcoin! Many suggest hedging in precious metals.
IMO, it can be *one* of the tools in your arsenal for sure but I'd strongly recommend having exposure to assets that complement one another nicely. When it comes to btc and precious metals, it doesn't have to be an "us vs. them" debate, the two actually complement one another and I strongly believe there's room for both in pretty much any portfolio :)
Some real estate here, some precious metals there, a bit of btc sprinked in and all of a sudden, your hedging strategy becomes a LOT more robust!
The assumptions made in your question makes no sense.
1) BTC is a speculative instrument
2) The Fed uses inflation as a means of escaping public debt
3) BTC is mostly governed by public perception/demand, rather than by macroeconomic indicators
4) Like Federal Reserve Notes, BTC is fiat. Unlike it, BTC is not controlled by a central authority, making its price highly volatile when subject to speculation.
If BTC prices rise faster than CPI levels, this only means that speculation for BTC outpaces general price inflation, but the opposite would be equally likely when public perception reverses. This dependency of BTC's price on public perception is a bubble and unsustainable.
The above facts should make it clear that BTC does not serve as a hedge against inflation.
Please don't be the victim of herd mentality. The online interest in BTC (like yourself) is pervasive, but backed by minimal economic understanding of the matter. (In fact... this is how the public overvalues BTC in the first place...)
@@kennethong1852 Funny how wrong you were.
1:53 you predicted the future
Awesome
If the monetary base (M0) equals M1 + M2, then how could M0 start out at 850million while M1 and M2 started out at 1.4trillion and 7.8 trillion, respectively
He didn't say monetary base = M1 + M2
Thanks !
You're more than welcome, Victor :)
March 2021, M1 discontinued...
So giving money to everyone in the US has a similar effect as M1 going up?
That would depend on *how* you give money to everyone (with options ranging from taxation exclusively to let's say changing the Federal Reserve Act and allowing the central bank to spend, ie give money to everyone directly, rather than merely lend) and what you mean by "a similar effect" :)
what is Parkwood
Fast is good! I listened at 1.25x :D
Now that's brave! :)
This should be remade for todays M1 and M2 data and posted all over the internet. Or at least for all the people that blame Biden for inflation.
Then where did all that money go?
so give the money to the public? prices will go up but they will spend that money on physical items and also, pay taxes to decrease the money base. If you keep it within the stock market, they pay less taxes and money just moves around in the financial cloud and never see the light of day (well, the majority of it) so, give to the citizens or give to companies (that buy back their stock etc)
Good contents, but you uploaded them with >2x speed… from the listener’s side, it’s annoying and stressful. Take the time bro, it’s unnecessary to try wrapping up your contents in less than 1 or 2 or 3 min. We appreciate good educations like yours, but please make it count.
Glad you like the content, and sorry for the speed, got carried away sometimes :(
god damn my real estate exam in making me learn so.much economics and law 😑😑why do i need to be so informed if the only time i even get close to law is by writing a special provision and i already have a fukn calculator...i dnt need 2 kno all this shit
Gosh bro, you trying to teach us something or win a speed-speaking competition...
I get carried away sometimes, heh, it's kind of become a meme that for some One Minute Economics video, TH-cam's playback speed reduction feature is a blessing :D
Maybe you could make a channel called 2or15 minute Economics. Cuz this shit is way too fast.
What is QE
I've published a video through which I explain that a few years ago, hope you find it useful: th-cam.com/video/qKOkqJMghNQ/w-d-xo.html
The pace of the explanation was too fast (and English is my first language). Could I perhaps suggest that instead of meeting the 1minute mark, you could do explanations in 3 minutes. It would still be very impressive and short, but much easier for ppl to follow.
No, you just need to keep up. I'd much rather have him explain it quickly than waste lots of time on a long drawn out explanation.
@@MrAmbrosse shut up max
Andrei, I like BTC but there is one problem. Problem is that BTC is a deflationary currency. This type of currency will not encourage spendings, therefore less businesses and getting a loan would be ridiculous. If I lend 100 BTC 5 years ago there is no way I can pay that off today. How do you see this?
Listen at X1.5 speed 😊
:D
1:53 ....
The narrator, is that Neil Goldman from Family Guy?
:D
Too fast to be useful!
We need to be able to listen, not hear only!
Sorry about that, it's a bit of a meme around here that I sometimes get carried away speed-wise and that TH-cam's playback speed reduction tool is a blessing :)
WAYYYYYYYYY TO FAST!!!! SLOW IT DOWN
Sorry Brandon, I sometimes get too carried away, would recommend using TH-cam's "slow down" feature in such cases... it's become a bit of a meme that it is sometimes necessary for my vids :)
Say slowly 😂
It's now at 4.5 trillion base and 22.5 trillion debt . How in the hell does that get fixed ? The younger generations are screwed .
It... well, doesn't, at least not in a painless way. For the most part, the name of the game revolves around paying off existing debt by creating new debt :(
Pleeeease English isn't my first language could u slow a bit !
Will do my best to tone it down a notch in future videos :)
Speed is very fast.. not good to understand for children
I sometimes go over-board speed-wise, sorry about that. For those videos, I'd recommend TH-cam's playback speed reduction tool :)
Jesus hell. I need fking slow down speed X2 to understand. Go save me
*2 speed make it more knowledgeable
:P
Huh?
If there are concepts you are having issues with, let me know and I will do my best to help. Or perhaps someone else can chime in through a comment
Hey, maybe you could talk just a little bit faster, and throw around a few more buzzwords - that'll make your explanation SOOOOO much easier to understand.
Challenge accepted! Benny Hill music on the house for additional synergy and mindfulness, because our organization always generates win-win situations by giving it 110%. Disruption is the new normal... how did I do?
wtf its going too fast
YOU SPEAK SOO FAST !!!!!
I get carried away sometimes, can't ague with that. It's become a meme of sorts that for some of my videos, it's necessary to use TH-cam's "slow down" feature :)
Where is M3 Poor user
I believe you should ask the powers that be :)
The speech is too fast to keep up with
Sorry about that
Too fast,
Sorry about that, Kevin :(
Too fast
I apologize for getting carried away every now and then :(
Too talk toooo fastttt
I do sometimes get carried away, trying my best to find the right balance :)
Talking WAY TOO FAST
Sorry, I get carried away sometimes. Fortunately, TH-cam has a feature that lets you slow down videos to make up for the days when I drink too much coffee :)
He talks much too fast I turned it off
Sorry to hear that Dave, I got carried away with some of the vids speed-wise and it's become a bit of a meme around these parts that TH-cam's playback speed reduction feature is a life saver :)
If you want to lecture to people, you need to learn how to speak slower and more clearly.
I apologize, finding the right balance between content and speed is anything but easy. It's become a bit of a meme around here that for some of my videos, TH-cam's playback speed reduction feature is a blessing :)
You speak too damn fast
Sorry for going overboard :(
This video makes no sense.
What are the concepts you are struggling with?
Calm tf down
Heh, sorry for going overboard speed-wise :(