from Prison Planet.com

Follow the M3 money to hell

Jerry Mazza
Online Journal
Monday, Oct 27, 2008

Let me not keep you in the dark. As Wikipedia states, our money supply has three large components. M1 is physical currency circulating in the economy plus demand deposits (checking accounts). This measure is used by economists to try and quantify the amount of money in circulation. M1 is the most liquid measure of money supply since it only contains cash and assets quickly usable for conversion to currency. Hang in.

M2 is MI + time deposits, savings deposits and non-institutional money-market funds. M2 is a wider category of money than M1. It’s also used to quantify the volume of money in circulation and to explain economic conditions. M3 is the biggie. It’s M2 + M1 + large deposits, institutional money-market funds, short-term repurchase agreements, and other larger liquid assets. It’s the broadest measure of money used to estimate total supply of money in the economy.

The Fed used to publish data on all three money descriptors. But for some strange reason (couldn’t be saving money as they claimed because they never save money), the Board of Governors of the Federal Reserve discontinued publishing data on M3 (which contain all data on M1 + M2 =M3) on March 23, 2006. M3 also included balances in institutional money funds, repurchase liabilities issued by depository institutions and Eurodollars held by US residents at foreign branches of US banks, in fact at all banks in the United Kingdom and Canada.

In other words, M3 tracked what the fat cats were doing with their bucks. You have to think, why would the Fed do this? Of all three categories, M3 was your best bet to track inflation, i.e., to monitor what the Free-Market’s “Invisible Hand” was picking from your pocket through inflation, sometimes called “the hidden tax” because that’s just what it is. When the government runs off some extra funny money rest assured it’s to spend it. And you get the tab. read