Talk:Money supply

message: Mandy deposits $810 that she have borrowed. Interest on credit are higher than those on deposits so why would she do that?  —Preceding unsigned comment added by 161.53.242.83 (talk) 10:30, 10 February 2010 (UTC)
replies: text: The text seems unfortunate... it is more complicated, e.g. Mandy pays her employees with the money in the hope that their work will return a profit in excess of the interest, and her employees deposit the money. MMMMM742 (talk) 07:45, 11 February 2010 (UTC)

text: It is not necessarily that complicated. Mandy e.g. purchases an used car from her friend, who, in turn, deposits the money received from Mandy (which she has borrowed from the bank). Penartur (talk) 18:30, 1 December 2011 (UTC)
thread_title:  Is Mandy dumb? 

message: In the second paragrah it is stated that, "Since most modern economic systems are regulated by governments through monetary policy, ...". In the most of the major economies (such as the US, UK, Euro-area, Australia etc.) the central banks have been made independent of the government, such that they can decide on the best monetary policy without political considerations. Previously this was not the case and monetary policy was in fact decided by the governments, which is still the case in some countries - however this can hardly be considered 'modern' and is not what happens in 'most modern economic systems'.  —Preceding unsigned comment added by 124.168.1.154 (talk) 11:46, 20 August 2009 (UTC)
thread_title:  Monetary policy by the government 

message: Does anybody know of or can provide a cited example of M3 for this article?
--Sage Veritas (talk) 20:07, 1 March 2009 (UTC)
thread_title:  M3 

message: What I'm looking for is, right after the list of M0...M3 near the start of the article, something like this, very concrete.  Now, what I wrote is probably really wrong, but that's just because of all of the questions that the article doesn't answer properly.  They need to be answered, and an example like this is a good way to do it.  Note humor and silly phrases illustrating my puzzlement.  
M0:
* I have ten us$100 bills.   That represents $1000 in the M0 supply for the United States.  
* I take one of my $100 bills and burn it in a fire.  The US M0 money supply, and my personal net worth, just went down by $100.  (?)
M1:
* I take the remaining nine bills and deposit it in my checking account at my bank.  The M1 money supply just went up by $900, but since the bank still has the cash, the M0 supply also still has that $900, and they go and lend it out to someone else.  (?)
* I write a check for $400, check number 71.   The M1 money supply didn't change total, it includes the $400 check and the $500 left in my account.  
* I burn check number 71.  M1 and my checking account still have $900 because the check is never cashed.  
* I write check number 72 for $100 to my friend Alice and she deposits it into her checking account.  M1 still has $900 in it, her $100 and my $800.  
* I go to lunch with my friend Bianca.  She's out of cash, so I lend her $20 and she promises to repay later.  Our mutual memory is sortof a virtual check, and the M1 money supply goes up by $20.  She repays on Monday.   M1 goes down by $20 as we virtually erase the virtual check.
* I get paid a paycheck for $10,000 into my checking account.  That chunk of M1 money came from my employer's checking account, which got it from customer payments and stuff.   I need it for the rest of these examples.   
M2 and higher:
* I write check number 74 for $500 and bring it to the bank and start a Money Market account.  Even though the bank is an 'institution', this qualifies as a 'non-institutional money market fund'.  Cuz I dunno.   M2 goes up by $500 as M1 goes down by $500.  
* I write check number 75 for $3000 and invest in Dreyfus Efficiency Restaurants Fund, a mutual fund that invests in small fast-food chains.  This $3000 is no longer in M1?  In the short term it goes into the company's checking, they go spend it somewhere, and M1 is conserved?.  Then they make a ton of money and eventually I cash out and get a check for $6000.  This money came from other people's checks when they bought stuff from the company, so it's all in M1?  But that means that capital is never created.  I don't understand.   It's almost like it's in M7 or something, far less liquid than m1 or m2.
* My grandma dies and leaves me her money market fund with $50 million in it.  Somehow this is an institutional money market fund... cuz when they started the fund, they checked off this box on their application that says "Do you want your  Money Market to be Institutional?  [ ] yes  [ ] no".  So this money is in M3??  You have to have a minimum of what, $5 million, to get it into M3 accounts?
Foreign Currencies:
* I write check number 73 for $200 and bring it to a bank teller and tell him I want to convert it to British Pounds.   On this particular day, the exchange rate is exactly 2.00 dollars = 1.00 pound.  The bank takes my $200 check, finds some other customer in their branch office in Hong Kong who has pounds and wants dollars, and brokers the trade.  (Both bank branch offices have piles of dollars and pounds for just such an occasion.)  US M0 still has the $900, although the customer in Hong Kong now has $200 of it.  The 100 pound note I walk off with is part of Britain's M0 money supply.  
OsamaBinLogin (talk) 05:00, 22 March 2008 (UTC)
replies: text: ...which got it from customer payments and stuff... go slow here. There is the other possibility that the employer got it by increasing his overdraft limit. In this case it is "created" money and suddenly M1 increases by that amount (until it is repaid). This is not an unnecessary complication but a vital element of understanding because most "money" is this kind of created money.
Janosabel (talk) 19:51, 9 November 2008 (UTC)
thread_title:  A simple example, please, something like this 

message: The problem with GDP is not that it is measured; it is that economists tend to view increasing GDP as "good" and decreasing GDP as "bad" regardless of what that GDP change represents. Thus economists tend to favor anything that increases GDP without looking at the micro effects. (This was one of the arguements in favor of slavery -- that having a large unpaid workforce increased general prosperity.) Jaysbro 15:25, 4 November 2005 (UTC)
replies: text: No, having a large unpaid workforce actually decreases current measured GDP, because if they were paid, then their wages and expenses would count towards GDP. It's just a measurement, and most of the time, increase in GDP is good. Of course it's not absolute, but when talking about a robust economy such as the United States, noticeable GDP increases are mostly always good. Of course there might be winners or losers to economic changes (globalization comes to mind, but that can easily remedied by reallocation or policy changes) Leigao84 19:30, 10 May 2007 (UTC)
thread_title:  GDP 

message: Can you say where you got this "least liquid" L variable from?  The Fed, for one, doesn't seem to measure it.  What is the difference between L and M3?  --Afelton 20:17, 9 November 2005 (UTC)
thread_title:  L 

message: - This debate needs to be moved to Monetarism. It's not about money supply. --Dilaudid 10:35, 10 March 2007 (UTC)
thread_title:  A Good Review of the Moneterists' Understanding 

message: [Deleted] -- did not realize there was that much cash out there
68.196.112.152 16:38, 11 August 2006 (UTC)
thread_title:  Innaccuracy 

message: What are IRA and Keogh balances?--Samnikal 13:23, 19 November 2006 (UTC)
thread_title:  What are IRA and Keogh balances? 

message: I am going to delete the last sentence of this since it is highly, highly debatable...  
"In the last 10 to 15 years, there is good evidence that many modern central banks have become relatively adept at manipulation of the money supply, leading to a smoother business cycle, with recessions tending to be smaller and less frequent than in earlier decades.
:: That's what sent me scurrying to the talk page. If the Fed had not changed the way the CPI is calculated, and eliminated the M3, and if the definition of the federal deficit had not changed, would the "cycle" look smooth? or would it look terrifying?  It is very un-Wikipedia to say there is "good evidence" without supplying a shred of it. Jive Dadson 20:18, 20 July 2007 (UTC)
replies: text: The problem is that there is no adjective attached to "demand." Taking money out of circulation reduces the supply of money. This, in turn causes interest rates to rise. The rise in interest rates reduces aggregate demand. Wikiant 19:08, 18 May 2007 (UTC)
replies: text: Strictly speaking that only works for central banks not operating under a fixed or pegged exchange rate regime. In general central banks do not conduct monetary policy this way. Whilst theoretically true the article should not give the reader the impression that this is a common way for central banks to conduct policy. Last but not least it rests on the idea that prices are sticky since in general prices will adjust leaving no real effects. The idea of central banks "sucking" liquidity by issuing bonds is nothing new, it just isn't a primary tool and in many cases not on the agenda since it affects interest rates. Perhaps this is better understood by remembering that the idea that central banks can increase demand by increasing the money supply has generally been abandonded. MartinDK 17:27, 14 July 2007 (UTC)

text: Question from fifteen years later
How does the recession of 2008 play into these arguments? Anyone?Dstar3k (talk) 21:47, 27 November 2022 (UTC)
thread_title: Arguments and Criticism

message: Hmm, this article talks about money supply and very little on money supply. So, why money demand is redirected here? __earth (Talk) 07:18, 1 July 2007 (UTC)
thread_title:  Money demand leads here? 

message: Would it not be correct to classify this as a theory of Keynesian economics? - MSTCrow 22:36, 7 August 2007 (UTC)
replies: text: It would be incorrect to classify the money supply equation as a theory of Keynesian economics because it is based on the Quanity Theory of Money (a 17th century theory); though, the velocity of money is an addition from Friedman(20th century) and Fisher(19th century) and may have some basis within Keynesian thought.  This equation is also used by classical economist and Monetarists and this section could be expanded to explain how the different economic schools  of thought use this equation.--EGeek 19:18, 10 August 2007 (UTC)
replies: text:  It needs to be more clearly written that it is a simple and additional tool at measuring inflation. It is incapable of measuring the real value of anything as it disregards the subjective portion of trade. Both this section and the actual Equation of exchange Page are poorly written and do not really educate of it's purpose other then the existence of another algebraic formula. Also this formula from who's theory's it was derived in recent and historical times is highly disputed quiet remarkely easily considered flawed as mentioned by MSTCrow above. That however is a whole other debate and not really relevant to this article. A whole other page could be created to the different types of Theory's of Value. Beaon (talk) 00:23, 7 January 2009 (UTC)

text:  Also, This statement needs to be re-written. It makes it appear that Money Supply is linked to inflation which is wrong. Money supply in itself is dumb and cannot expand or contract on its own. Money supply is only a representation of inflation. Inflation itself is linked to monetary policy, usually in regards to the manipulation of the commodity known as credit. Beaon (talk) 00:23, 7 January 2009 (UTC)
thread_title:  Monetary exchange equation 

message: Any objections? Sonic Craze 00:36, 24 October 2007 (UTC)
replies: text: None here. I think this merger is a good idea. -FrankTobia (talk) 18:38, 17 December 2007 (UTC)

text: No, I agree it's a great idea. MilesAgain (talk) 19:14, 21 December 2007 (UTC)

text: Agree. It makes sense.  --Gherrington (talk) 22:02, 1 January 2008 (UTC)
replies: text: There is also a separate page on monetary base. Finnancier (talk) 04:19, 2 February 2008 (UTC)
replies: text: Support. Monetary base should be merged/removed also Ummonk (talk) 19:12, 7 November 2008 (UTC)

text: Support Merge Morphh  (talk) 3:34, 24 February 2008 (UTC)
thread_title: Merge [[M4 money supply]] into this article

message: All the charts need converting to log scales on their y axes to be useful visual representations of the underlying data.  —Preceding unsigned comment added by 87.194.2.217 (talk) 21:16, 16 April 2008 (UTC)
thread_title:  Chart scales 

message: I have removed the "Recent Money Supply changes" section. I would consider this unencyclopedic; it would need to be constantly updated otherwise it would be outdated and therefore not useful. Gary King (talk) 21:57, 19 February 2008 (UTC)
thread_title:  Recent Money Supply changes 

message: In the Purpose section of the article it states: "The money supply is considered an important instrument for controlling inflation by economists who say that growth in money supply will only lead to inflation if money demand is stable."  However, according to historical definition, inflation IS by definition an increase in the money supply (ie. inflation is a cause [increase in money supply], not an effect [prices of things increase]).  Can we fit this in here somehow while maintaining NPOV? 98.223.131.191 (talk) 07:30, 8 July 2008 (UTC)
replies: text: This is incorrect. The defintion of inflation is a positive change in a price index. To say that "inflation is a cause of an increase in the money supply" makes no sense. Inflation is endogenous while the money supply is exogenous. Wikiant (talk) 13:57, 8 July 2008 (UTC)

text: Actually, monetarism is based on the Quantity theory of money which directly relates the quanity of money (supply) with economic output (demand).  Not all economists agree on this, the statement should read "...inflation by monetarists, who say..." instead.  Also the consumer price index only a measures one type of inflation.  The GDP deflator is the measure of inflation that absorbs economic output, which does not use the consumer price index. What type of inflation is suppose to be represented in the article? -- EGeek (talk) 04:17, 11 July 2008 (UTC)
thread_title: Definition of Inflation

message: In the second line, is monetary aggregate a methodology to measure money supply or is it a synonym of money supply? Zain Ebrahim (talk) 12:43, 20 July 2008 (UTC)
replies: text: Money supply is a vague and general term.  Monetary aggregates are those measures of money supply that combine more than one 'type' of money. ie. M2 (savings deposit + checking deposits + physical money (cash)] is a monetary aggregate. lk (talk) 05:08, 18 September 2008 (UTC)
thread_title:  Question 

message: Imaginary Federal government creates money out of thin air: 200,000</br>
200,000 is deposited into the world bank</br>
Bank loans out 180,000 for a home, which it creates out of thin air</br>
Possible correction here: the only ones creating money is the Fed, the bank loans out 180k, keeping 20k as reserve... It could work both ways, according to: http://en.wikipedia.org/wiki/Fractional-reserve_banking#A_Simple_Example:_A_Single_Bank</br>
Now there is 380,000 existing</br>
Assuming for simplicity that the 180k is redeposited, the bank has 200k plus the home, but they owe the Fed 200K and the depositors 180k
scenario 1:</br>
Mortgage gets paid back</br>
Money in circulation is reduced by 180,000</br>
Bank has 200,000 + interest</br>
Interest came from other loans the bank made</br>
Money supply has to keep increasing in order for people to be able to pay interest
scenario 2:</br>
Mortgage gets defaulted on</br>
There is still 380,000 in circulation...</br>
200,000 in the bank (after all, didn't the money get created out of thin air, to the limit of the required reserves?)</br>
180,000 to the people that got paid for the house</br>
Bank owns the home!</br>
scenario 3:</br>
Mortgage gets defaulted on</br>
There is still 200,000 in circulation...</br>
Bank had 200,000, but according to rules it is supposed to delete 180k</br>
20,000 in the bank</br>
180,000 to the people that got paid for the house</br>
Those people deposit the 180,000 in the bank</br>
Bank owns the home!</br>
Bank still has 200,000, just in different accounts</br>
Bank never had 200k.  They just make money on interest.  They owe the Fed 200K, They owe the depositors 180K.  They have a home and they have the 20K reserves, or they have 200K reserves, depending on which branch of the following example you want to follow: http://en.wikipedia.org/wiki/Fractional-reserve_banking#A_Simple_Example:_A_Single_Bank
People are deleveraging, reducing the money in circulation.  In this situation, where are people going to get the money to pay off loans + interest???   With the money supply decreasing as people pay off loans, many can't --Campoftheamericas (talk) 17:07, 31 January 2009 (UTC)
thread_title:  credit money system question 

message: This is my first time participating in the information side of Wikipedia and I have only done it because I feel that one example maybe incorrect and hope discussion helps confirm/corrects the example. 
- Laura goes to lunch with her friend Bianca. Bianca's out of cash, so Laura lends her $20 and she promises to repay later. Their mutual memory is a form of virtual check, and the M1 money supply goes up by $20. Bianca repays on Monday. M1 goes down by $20 as the debt is satisfied.
-I could be wrong but here goes,
Here is the rub with this idea of personal credit inflating the money supply or M1 in this example. Laura who is the Lender here is not increasing the money supply because there is no fractional reserve lending that is taking place. In the hypo leading up to it Laura has 900$ in an account I believe. 
Say she lends out 20$ to Bianca, she now has 880$, 20$ N/R, and Bianca has 20$. Is the 20$ N/R chequebook money as is used when a financial intermediary participates in it. 
If so does this even fit into the definition of M1 money supply as it is stated above the example?
Mvalioll (talk) 05:06, 8 April 2009 (UTC)
replies: text: I have removed the example.  The definition of M1 money supply does not include the $20 Laura lent Bianca. - Crosbiesmith (talk) 17:37, 8 April 2009 (UTC)
thread_title:  The "Simple Example" Part of the explanation 

message: Chicago Fed - Our Central Bank: http://www.chicagofed.org/consumer_information/the_fed_our_central_bank.cfm
as of now ref#15.  Links doesn't work.
70.18.23.71 (talk) 18:54, 19 April 2009 (UTC)
thread_title:  At Least One Footnote Antiquated 

message: I really like that there's a Laura example so the reader can follow along with a sequence of steps to understand.  To be more complete, the example should name the borrower that the bank lends $900, and explain what happens when the borrower repays the $900 (or, better, a fraction like $600) to the bank.  Tempshill (talk) 21:55, 9 May 2009 (UTC)
thread_title:  The Laura example 

message: In the "Example-M1", the sentence: "Since the bank still has the deposit on its books, the M0 supply also still has the original $900, as does M1, because M1 includes M0. " is wrong, conflicting with the definition of M0 above (deposits are not part of M0). At this point in the example the amount of M0 depends on what happened to the $810 first loan. If it is deposited into a second bank (but not loaned out yet) then a minimum of $81 is deposited into the central bank (M0 is now $171=$81 + $90). Because it was not loaned out by the 2nd bank the remaining $729 are excess reserves which may or may not be deposited into the central bank. 
Yes after the original $900 makes it way completely through the web of the banking system with each bank loaning the maximum amount out, the M0 component will go back up to $900 (this $900 will be composed entirely of reserves), but at this stage, with one deposit + one loan the M0 component generally not be $900. Jeffbood (talk) 16:19, 7 July 2009 (UTC)
thread_title:  "Example", error 

message: I don't think the example is correct in the following steps:
    * Laura deposits her paycheck for $5,000 in her checking account. That part of M1 money came from her employer's checking account. No change in total M1 based on the original $ 900. (M0 = $900, M1 = $1710)
M2
    * Laura writes check number 7774 for $1000 and brings it to the bank to start a Money Market account. M1 goes down by $1000, but M2 stayed the same, because M2 includes the Money Market account, but also everything in M1. (M0 = $900, M1 = $800, M2 = $1800)
In the first step, M1=1710. In the second step, "M1 goes down by $1000". Doesn't 1710 - 1000 = 710? So that would mean M1 = 710, and M2 = 1710 in the second step. Also, in step 2, "M2 stayed the same". I think 1710 is the same as 1710 not 1800 (M2 includes all of M1).
In step 1, how can M1 be 1710, when there was a checking account with an amount of at least 5000? M1 includes checkable deposits regardless of whose account it was (her employer's or her's). If the example is only from the point of view of Laura's impact on the money supply, then it would be helpful to say so.
Eiflerian (talk) 00:33, 29 July 2009 (UTC)
thread_title:  Example  

message: The calculations that you have used in this article(Laura) to calculate generated loan credit for the bank as derived from the fractional reserve lending multiple of 1:10 from the depositor's $900 deposit is incorrect.
A Simple Correct Example
The depositor deposits $100 into the bank.
The bank is now allowed to generate, using fractional reserve lending at 1:10, $900 for loans.
The deposited $100 held in the bank as physical cash represents the 10% of the whole  -- ie deposit($100) + credit($900). And the $900 is generated out of thin air for the bank's loan assets.
Reference
http://www.basicincome.com/basic_banks.htm
:The bank is not allowed to lend more than a fraction of the deposited money. In order to get to the multiplier you mentioned, the loaned money has to flow back into the bank (e.g. the borrower buys a car, the car dealer deposits the money). Then the bank is again allowed to lend a part of this money. If the reserve requirement is 10%, then with the new loan the money supply has increased from $100 to $100 + $90 + $81 = $271. This can go on as a geometric series, converging to a money supply of 10 times the original. MMMMM742 (talk) 11:00, 25 April 2010 (UTC)
thread_title:  Incorrect Examples of How Fractional Reserve Lending is used in Your Article. 

message: The article describes money supply at some length and it is quite obviously a complex subject. But where can I find some information on the effects of changes in the money supply? For example, around the beginning of this year (2009), the Fed introduced a step change in the money supply that doubled the U.S M0 or Monetary Base thereby devaluing the Dollar. What is the expected effect of this action? Does anyone know? Do theories exist that economic analysts would use to divine the results of a given action or is it more of a by-guess-and-by-gosh kind of thing?
The article argues between Keynes and Friedman but doesn't provide much insight into the dynamics of the system. As I see it, Dollars in the free market are a commodity like wheat or gold and are subject to laws of supply and demand. The Dollar is worth so much less today than, say, fifty years ago because the market is glutted with them. Increasing the M0 is going to drive down the value of the Dollar. For those buying U.S. goods, this is a windfall because they can get more for their Pounds or Yen or whatever. Going the other way, however, it raises the price of foreign goods to U.S. buyers and is, in effect, a tariff, i.e., protectionist. Is this correct?
It would seem that changes in monetary policy would produce predictable effects. If not here then where should the reader look? --Virgil H. Soule (talk) 19:04, 24 October 2009 (UTC)
replies: text: I recommend looking at the history of direct targetting of the money supply, particularly in the 1980s and especially in countries with excellent statistics like the US or UK. The central problems of predicting monetary policy effects with any sort of precision are that (a) the velocity of money is not a constant, (b) monetary policy action x will have an unpredictable effect on the money supply and therefore won't have a clear effect y on the economy as a whole, (c) monetary policy is not isolated from the rest of macroeconomic policy, eg. a change in public borrowing can have an effect on the money supply, which is why Gladstonian "balance-the-budget" thinking, as was popular in the UK in the 1990s and early turn of the century, is a crude but rather effective macroeconomic tool.
On the other hand, one shouldn't take this scepticism too far: if you're looking for the degree that the impact of monetary policy can be understood, check out some modern monetary economists like Tim Congdon. Monetary policy is in roughly the position of cannon-aiming in the 19th century- you can predict which way the cannonball will go and the general area that it will land in, but the kind of precision you find in modern artillery was inconceivable. The same is true for monetary policy and if you can work out a way of accurately predicting the impact of either policy changes on the money supply or the money supply on macroeconomic conditions, your Nobel Prize awaits.Pragmatism24 (talk) 16:07, 5 November 2009 (UTC)
thread_title:  Effects of Changes in the Money Supply 

message: In measures of the money supply including money market securities like commercial paper, is it the market value of these securities or the face value/value at maturity (assuming there is no default) that contributes to e.g. an M3 measure? MMMMM742 (talk) 19:55, 13 January 2010 (UTC)
thread_title:  Market value or face value 

message: Anybody knows where I can find that? Like in $ bills and $ coins and € bills and € coins, etc. and all that added up? I thought that is what is what the articles on "Money market" or "Money Supply" would be about? Thx. --SvenAERTS (talk) 01:04, 25 January 2010 (UTC)
replies: text: GDP is annual production (a flow measure) while money is a stock measure, so your question doesn't make sense. You may mean to ask, "what is the total value of coins and bills issued by the various central banks?" The "coins and bills" we call M0 (see money supply). Note that that is only a small portion of the money supply -- most of the money supply is not in the form of coins and bills. Wikiant (talk) 13:39, 25 January 2010 (UTC)
replies: text: The question does make sense because the answer might tell you something about the velocity of money (e.g. Japan has a lower velocity of money, and a higher ratio of various measures of money supply and GDP than the U.S.). For the data you should look on the websites of the central banks - the Fed's balance sheet can be found here (updated weekly). Currently the currency in circulation (M0) is 918 billion dollars. MMMMM742 (talk) 14:54, 30 January 2010 (UTC)
thread_title:  How much of the world GDP is available in printed and coined money ? 

message: Error in example + hypothesis about how it happened:
In "Example", when going from the end of M1 to the beginning of M2, the numbers don't match.  The check numbers went from 7772 to 7774, so I guess some actions in the middle were deleted.  In such case, the rest of the example should be re-written.
This repeats later, in the beginning of Foreign Exchange, where it says that "US M0 still has the $900", although it was $4900 just before.  In this case, bank note numbers jumped from 7774 to 7776.
Also, there's an inconsistency between the example and the table above.  In the example, in the beginning of M1, it says that all of the $900 is "part of the bank's excess reserves", so MB = $900, M0 = 0, M1 = $900, M2 = $900.  But according to the table, access reserves are only part of MB and not of M1 or M2.  —Preceding unsigned comment added by 98.209.17.185 (talk) 03:49, 26 January 2010 (UTC)
thread_title:  A few problems 

message: The two sites referenced for M3 calculations, especially the "shadowstats" onel are sites with clear biases and are not credible sources at all. Can anybody tell me why these two references shouldn't be deleted? --Dwarnr (talk) 20:33, 4 February 2010 (UTC)
thread_title:  M3 

message: The bullets below the "type of money" chart are a tease; they are more like notes, one says what a category is not rather than what it is.
Money supply type definitions in a short format should collectively describe what the money supply is.
Major categories:
* MB: total currency
**checking deposits
**etc
* M1: ?? (this is the category most commonly referred to by other pages)
* M2: the amount of money in circulation
* M3: ??
Other:
* MZM: Money with zero maturity, supply of financial assets redeemable at par on demand <- not understandable by the average wiki reader
* M0: monetary base in some countries, or narrow money
--John Bessa (talk) 13:02, 1 August 2010 (UTC)
thread_title:  M0 	MB 	M1 	M2 	M3 	MZM 

message: "The M1 money supply increased by $810 when the loan is made. M1 the money has been created. ( MB = $900 M0 = 0, M1 = $1710, M2 = $1710)"
M0 should be $810, not $0, because the person taking a loan receives 8 $100 bills and 1 $10 bill.
I propose the following change, but please confirm if my understanding of M0 is correct:
"The M1 money supply increased by $810 when the loan is made. M1 the money has been created. ( MB = $900 M0 = $810, M1 = $1710, M2 = $1710)"
November 3, 2010
131.107.0.81 (talk) 20:46, 3 November 2010 (UTC)
thread_title:  The M1 money supply increased by $810 when the loan is made. M1 the money has been created. ( MB = $900 M0 = 0, M1 = $1710, M2 = $1710) 

message: The graph purporting to show the assorted monetary aggregates for Japan must surely be wrong. The supposed units are "100 yen" which is of the order of one dollar. So the monetary aggregates for Japan look to be on the order of 10million dollars. This can not be right, its far too small - surely there are some missing zeros! Reissgo (talk) 11:56, 14 March 2011 (UTC)
thread_title:  Japanese money supply graph - surely some mistake! 

message: It is only the US Central Bank (the FED) that has this dual mandate (inflation and unemployment).  Other country's central banks target inflation only, e.g. the ECB, which targets 'price stability' i.e. low inflation.  This should be explicitly stated to avoid confusing readers.  — Preceding unsigned comment added by Pmacaodh (talk • contribs) 10:29, 1 September 2011 (UTC)
thread_title:  Arguments 

message: The link to the RBA website for the Australian money definition doesn't work any more. 202.171.164.59 (talk) 05:05, 11 October 2011 (UTC)
thread_title:  Reference Australia 

message: http://en.wikipedia.org/wiki/Divisia_monetary_aggregates_index
Also, perhaps include a couple of sentences about this? Namely, these indices are the same idea but could be better than simple-sum aggregates?
I am adding the suggestion to the "Divisia Monetary Aggregates" page. 
(Sorry, just joined wiki 5 minutes ago. When I get more comfortable I may come back and do the changes myself...)  — Preceding unsigned comment added by Dvorak oneday (talk • contribs) 23:23, 3 January 2012 (UTC)
thread_title:  Include link to Divisia Monetary Aggregates ? 

message: The graph for the U.S. monetary base shown in this article is very different than the graph of the St.Louis adjusted monetary base graph found here. Please explain in the article.  — Preceding unsigned comment added by 207.179.172.216 (talk) 19:23, 13 January 2012 (UTC)
thread_title:  U.S. Monetary base vs. St.Louis Adjusted Monetary Base : clarification please

message: What happens to M2,if Mandy goes bankrupt?
Bank will acknowledge that his $810 loan will never be re-payed.
In such case,the sum  $810 will be subtracted from M2?  — Preceding unsigned comment added by 80.188.193.66 (talk) 08:53, 3 April 2012 (UTC)
replies: text: Nothing.  The bank will write off the loan and deduct $810 from the asset side of its balance sheet; the monetary aggregates look only at the liability side. Ferridder (talk) 18:13, 18 April 2012 (UTC)
thread_title:  What happens to M2,if Mandy goes bankrupt? 

message: The bank cannot create $810 in credit money without there being a borrower for the money, e.g. Mandy. Same thing with the second time the money is lent out. I suggest to modify the example by not updating M1,M2 until the loan(s) have been made. Comments? Ferridder (talk) 18:13, 18 April 2012 (UTC)
thread_title:  The $810 credit lent to Mandy 

message: I am no expert in $$$ but I find this article poorly written because I see government (/central bank)accountability as most important in the concept of 'money (currency) supply'.
As mentioned, M0 refers to the total amount of printed currency in circulation (owned by persons other than the issuing authority), M1 meaning M0 plus demand deposits in banks.
According to Singapore's definition as seen http://www.mas.gov.sg/data_room/msb/Money_Supply_Compilation_and_Revisions.html  M2 is M1 plus 'quasi money'; 'quasi money' defined as something akin to a treasury bill.
There should be no duplicity in the ownership of a unit of currency which makes the Laura example which discussed 'fractional reserve banking' quite irrelevant if not misleading in this respect.
This is because I think that the primary role of money (currency) supply measurement should be the accountability of the central bank in regard of the adequacy of its reserves to balance any claims against its issued currency should a run on the said currency occur.
In the good old days (before Bretton Woods), every US dollar was backed by a defined measure of gold in the vault of the US central bank but no longer; at present, at least some other valid substitute should be required.
Back to the case of M2 being M1 plus 'quasi money'- this is important as it represents the total liability of the central bank issuing such a currency since it is a measure of the total quantity of currency possibly orphaned should current holders of such currency choose concurrently to dispose of such currency. Whatever the value of the currency (or T-bill) in discussion is would then be determined by the amount of foreign currency or other asset that the central bank has in exchange for the said currency now being sold on the international currency exchange market place.
An accurate assessment of the total currency and T-bills of a sovereign in circulation as a ratio of the sovereign assets allocated to validate such liability, pari-passu, is thus integral in any effort to determine an accurate value of a sovereign's unit currency as opposed to that of another.  — Preceding unsigned comment added by 220.255.2.70 (talk) 00:19, 7 May 2012 (UTC)
thread_title:  Definitions of Money supply (M1, M2) need a defined purpose. 

message: what is money supply and the evolutin of money supply  — Preceding unsigned comment added by 195.24.220.16 (talk) 20:54, 12 November 2013 (UTC)
thread_title:  evolution of money supply in africa. case study: cameroon 

message: In the "Laura" example, we read "M0 = 0", at Step 10.
(Mandy's bank now lends the money to someone else who deposits it on a checking account on yet another bank, who again stores 10% as reserve and has 90% available for loans. This process repeats itself at the next bank and at the next bank and so on, until the money in the reserves backs up an M1 money supply of $9000, which is 10 times the M0 money. (MB = $900, M0 = 0, M1 = $9000, M2 = $9000)
A few lines down, at Step 12, we read: "US M0 still has the $900"
But nothing has occurred in between to increase M0 by $900.  — Preceding unsigned comment added by Euforbio (talk • contribs) 16:09, 22 December 2013 (UTC)
thread_title:  Example - Step 10 vs. Step 12 inconsistency 

message: In the 1st table, the only check mark in the M0 column corresponds to the 1st row:
"Notes and coins in circulation (outside Federal Reserve Banks and the vaults of depository institutions) (currency)"
Directly underneath the table you note:
"M0: In some countries, such as the United Kingdom, M0 includes bank reserves, so M0 is referred to as the monetary base, or narrow money."
Which implies that perhaps in the US (which is what the preceding table was about) M0 does NOT include "bank reserves."
And then later in the this section:
http://en.wikipedia.org/wiki/Money_supply#United_States
You write about MO the following:
"M0: The total of all physical currency including coinage. M0 = Federal Reserve Notes + US Notes + Coins. It is not relevant whether the currency is held inside or outside of the private banking system as reserves."
So here it's clear that being inside or outside the private banking system as reserves is "not relevant" to its status as M0, but in the table you clearly state that it's ONLY the currency OUTSIDE depository institutions. This seems to be a direct contradiction.  — Preceding unsigned comment added by 68.6.85.103 (talk) 14:40, 10 April 2014 (UTC)
thread_title:  Discrepancy in description of M0 in the US 

message: ::The bank then calculates its reserve using the minimum reserve percentage given by the Fed and loans the extra money. If the minimum reserve is 10%, this means $90 will remain in the bank's reserve. The remaining $810 can only be used by the bank as credit, by lending money, but until that happens it will be part of the bank's excess reserves.
This is wrong. The 10 % reserves has to be the banks capital, here it is explained as a fraction of the deposit. All 900 dollars are debt for the bank and no fraction of this can be used as capital. — Preceding unsigned comment added by 95.128.109.13 (talk • contribs) 
:::Dear user at IP 95.128.109.13: You are correct that the bank now owes the customer (we'll call him "Customer #1") $900; that's the bank debt. The bank owns a corresponding asset of $900 (vault cash).
:::Now, let's say that the next day, someone else comes in and wants to borrow money. We'll call that person Customer #2. Now, let's assume that the $900 is all the vault cash that the bank has, and that the bank has no other assets, and that the bank just opened for the first time when Customer #1 made the $900 deposit. (In this case, the bank would have zero stockholders' equity, which is not the way a bank is set up, but we're just illustrating a point here.) If the government regulator says that the bank must maintain a reserve of at least 10% of the bank's liabilities and the bank is willing to make the loan to Customer #2 by doling out cash (instead of creating a second deposit liability), then the most that the bank can legally lend to Customer #2 is $810. That is computed as follows: $900 deposit liability x 10% = $90 that must remain as vault cash, so $810 in vault cash ($900 - $90 = $810) can be legally loaned to Customer #2.
:::The $10 is not part of the bank's "capital" -- at least not as the term "capital" is normally used in banking in the United States. Famspear (talk) 22:26, 10 March 2015 (UTC)
thread_title:  Reserves 

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thread_title:  External links modified 

message: I've been looking up uses of M0, M1, M2, and M3 and it appears that all the different sites use them in different ways, such that they mean little more than i, j, k in FOR...NEXT loops and thus no one site can be considered an authority. Hackwrench (talk) 13:24, 12 October 2015 (UTC)
thread_title:  M0, M1, M2, M3 do not appear to have much meaning 

message: just imagine her withdrawing the cash, first, then depositing it. in fact, that's probably what actually happens.
as soon as you make the cash liquid, it's mb.
:I reverted this because I don't think it's correct.
:When a withdrawal gets made the bank takes the funds out of its reserves (this is the point of reserves), either vault cash or its central bank account which are part of the monetary base. This doesn't matter whether the deposit is "original" or based on credit. In this case the $810 transfer is paid to the other bank directly out of the first bank's reserves. The monetary base does not change. Equilibrium007 (talk) 02:47, 1 March 2016 (UTC)
thread_title:  easiest way to understand why the mb increases when mandy makes a deposit 

message: I'm hoping to try to clear up some wording issues around countable/uncountable nouns, but not being an economist myself, I'm not sure about what is meant by the following:
*First sentence:
"In economics, the money supply or money stock, is the total amount of monetary assets available in an economy at a specific time.[1]" 
Does this mean the total value of the monetary assets or does it mean the number of monetary assets? 
(The cited source, P.M. Johnson, uses the following language to talk about this: "The money stock is the total amount of money available in a particular economy at a particular point in time.")
*I have the same question in regards to the following two sentences from the subsection 'Bank reserves at central bank':
"This means that instead of the amount of loans supplied responding passively to monetary policy, we often see it rising and falling with the demand for funds and the willingness of banks to lend."  
"Between 1995 and 2008, the amount of consumer loans has steadily increased out of proportion to bank reserves."
any help appreciated
  
--TyrS 12:55, 29 March 2017 (UTC)
thread_title:  grammar for clarity - questions for an economist 

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thread_title:  External links modified (February 2018) 

message: See the note under the graph here... (Beginning May 2020...)
https://fred.stlouisfed.org/series/M1
The definition of M1 is now wrong in the table and the "United States" section as it definite includes savings deposits. I don't know enough to fix it myself and update all relevant fields.  — Preceding unsigned comment added by Francophilique (talk • contribs) 03:03, 6 April 2021 (UTC)
thread_title:  M1 Definition incorrect/Out of date  

message: I made these changes but but  reverted them on the basis of NPOV. I don't understand how my edits weren't neutral. I don't think my edit is any different to what's being said on the fractional reserve banking page currently. Reissgo (talk) 08:33, 29 November 2021 (UTC)
thread_title:  Not NPOV?