M1 consists of: (1) currency outside the U.S. Treasury, Federal reserve
Banks, and the vaults of depository institutions; (2) traveler's checks
of nonbank issuers; (3) demand deposits; and (4) other checkable
deposits (OCDs), which consist primarily of negotiable order of
withdrawal (NOW) accounts at depository institutions and credit union
share draft accounts.
Click on any chart to see a sharper image.
M1 vs. Real GDP/10 1959-Present
M1 vs. Real GDP/10 2000-Present
M1 vs. Annualized Change in Real GDP
The third chart shows annualized change in GDP vs. M1.
Increases in M1 no longer have the same effect on growth or jobs.
M1 as Percentage of GDP
M1 money supply has increased under Bernanke at a faster pace than ever before relative to GDP.
I will take a look at GDP vs. other money supply measures later this week.
Mike "Mish" Shedlock
Here are a few interesting charts of M1 money supply vs. Real GDP/10 from reader WendyBG.