christopher heiser <christopher AT heiser DOT net>
Date Published: April 7th, 2008
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Money, Money, Money

Dr. Jawdat and I have had a few interesting conversations on the subject of money. The difference between us being that he actually studies this stuff, while I simply entertain uneducated notions in my head. Part of my recent education has been focused on the money supply which is partially tracked by the Federal Reserve.

One of the measurements of how much money there is in circulation is called M1 which currently is about 1.5 trillion dollars. Not that much considering that the GDP of the US is around $14 trillion.

There is another measurement called M3 which tries to capture the broadest measure of money. The government has stopped estimating this number, but in 2005 it was just over $10 trillion.

Which raises for me a very interesting question: where is the rest of the value in the US? If you added up illiquid assets such as property, resources, and so forth, what percentage of the wealth of the country is in money? On first glance it would seem very little.

by Christopher Heiser on April 7 16:42
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