23 March 2010

An education

Warning! This will be educational for most people.

He doesn't discuss velocity of money theories (the multiplier effect, much discussed in the stimulus bills, is mostly based on this), which I think is more pressing on inflation/deflation than the actual amount of money in circulation and which in part explains why credit is still crunching despite a massive injection of money by the Federal Reserve last year (but not this year), but it's still a pretty good summary of things as they stand.
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