Money Is ‘Disappearing’ So Where Did It Go? – Bank Crisis Spreads

by admin in The Money GPS
The velocity or the speed at which money moves in the economy is decreasing, making financial conditions worse even as the Federal Reserve (the Fed) increases its money supply. When banks have problems, it affects the whole economy. In 2008, banks stopped lending money, causing the velocity of money movement to drop. Central banks tried to fix the problem by lowering interest rates and increasing their money supply, but it didn’t work until 2020. Now, there’s a new issue with inflation, and banks are struggling to adapt to rapid rate increases. Central banks are trying to prevent a severe recession by improving their money supply, but it doesn’t seem to be working yet. In the last two weeks, the Fed has increased its money supply significantly. However, as this has increased, the velocity of money movement is going down. Why is this happening? People are taking their money out of smaller banks and moving it to larger banks or higher-yielding money-market funds. This causes the speed of money movement to decrease even more. Money-market funds have grown by almost $250 billion in the last two weeks. These funds invest in low-risk, short-term loans and have a low impact on the velocity of money movement. The RRP, which effectively neutralizes money movement, has also grown to new all-time highs of $2.65 trillion. Banks are likely to face more challenges, as they have about $2 trillion in losses from long-term investments. The Fed’s current strategy is making it difficult to control both inflation and economic growth at the same time.
See Also: (TMGPS) – Oil Prices DROP: Is $40 a Barrel Coming Soon?


Also: (TMGPS) – Deutsche Bank Default Odds Rise Higher! Bank Crisis Goes Global


Also: (TMGPS) – The Next Phase is the Currency Crisis | It Has Already Begun


Also: (TMGPS) – Xi and Putin’s New World Order: The End of the US Dollar


Also: (TMGPS) – Fed Balance Sheet Goes WILD as Banking Crisis Escalates | Deutsche Bank Next?


Also: (TMGPS) – Fed Leading Economy Back Into 2008 | The Next SVB Only A Matter of Time


Also: (TMGPS) – Fed Just Did Something Unexpected and Everyone Is Freaking Out | Here’s Why


Also: (TMGPS) – BRICS Shake-Up: Iran & Saudi Unite | China’s Battle With Dollar!


Also: (TMGPS) – Banking Crisis Meets Critical ‘Minsky Moment’ | Fed’s Wild Reaction Explained


More From The Author:

  1. The Fed Created the BIGGEST BUBBLE EVER Even JP Morgan Is Warning Tech Stocks Will Collapse! The Money GPS – February 19th, 2020 See Also: (TMGPS) – HSBC Warns 35,000 MORE Job Cuts! Janet Yellen Said Fed Should Buy Stocks When Market Crashes! Also: (TMGPS) – China – U.S. Trade Deal DELAYED as Economy Plummets Closer...
  2. Money Printing ➡️ Wealth Gap ➡️ Societal Breakdown ➡️ Complete Collapse The Money GPS – December 20th, 2019 See Also: (TMGPS) – Fed “Glitch” Causes Panic Among Banks Across U.S! Yield Curve 100% Perfect Recession Pattern Also: (TMGPS) – China Trade Deal MAJOR PROBLEMS! China Invests Billions With Argentina and Brazil!...
  3. Fed Admits Massive Number of People NOT Working! U.S. Economy in Real Crisis The Money GPS – Published on Mar 11th, 2019 See Also: (The Money GPS) – Nearly 5000 U.S. Stores Closing Already in 2019! MASS Debt and Bankruptcy Also: (The Money GPS) – The Fed and BIS Both SOUND THE ALARM...
  4. Americans Are Fleeing California and New York! I’ll Show You Where They’re Going. Published February 14th, 2019 – The Money GPS See Also: (The Money GPS) – Europe Deflationary COLLAPSE Accelerates! Trillions Printed and Economy Still In Crisis Mode. Also: (The Money GPS) – How To Find Out Exactly What Stocks Big Investors...
  5. Global Trade Indicator Falls 50% in 2019! Baltic Dry Freefall Over China – U.S. Trade Fiasco! Published on Feb 10th, 2019 – The Money GPS See Also: (The Money GPS) – This Chart Shows If Unemployment Rises 0.1%, A Recession Will Happen In Months!...
  6. Market DROPS 300 Points as U.S. – China Trade Meeting Cancelled! Published on Jan 22nd, 2019 – The Money GPS See Also: (The Money GPS) – Bailout For Sears Pension Plan! Sears Blames the Fed For Pension Failure Also: (The Money GPS) – Massive Store Closures and Layoffs Globally! “Protracted Economic...