Will The Soaring Money Supply Create The Next Financial Crisis?

THE MONEY SUPPLY HAS TRIPLED IN PAST 15 YEARS AND IS RISING FAST

The money supply has risen sharply in the 21st century, spurred by the 2008 financial crisis and pandemic induced global recession of 2020, increasing more than 300% in the past 12 years.

Increasing the money supply to counter the 2008 crisis and 2020 pandemic was certainly justified. However, of greatest concern is the sharp increase in money supply in the period between these events which reflects a fragile global economy that requires major ongoing intervention to prevent a significant economic contraction.

The current recession and popularity of the so-called Modern Monetary Theory guarantee that the money supply will continue to soar through the decade.

We expect the next financial crisis will occur later this decade when market forces begin to increase interest rates at the long end of the yield curve in response to concerns about credit quality, which will produce great risks and opportunities.

If you found this post of interest, you’ll find the Global Investment Letter of value. To view free sample issues please visit: https://www.globalinvestmentletter.com/sample-issue/