Top Three Videos – July 27, 2024

The current contraction in the money supply in the United States is likely to lead to a recession by 2025, and the Federal Reserve should be held accountable for not addressing this issue.

Historical Monetary Contractions and Recessions

• Only four monetary contractions before the current one, all followed by recessions.
• “Inflation is always and everywhere a monetary phenomenon.”
• Here’s an institution that’s responsible for monetary policy and the production of money in the United States and they don’t even look at money.
• The last time we had a money supply contraction like this was 100 years ago, and the data shows us that after you have a contraction like this, more often than not, you have a recession.
• Steve Hanke suggests that the chairman of the FED should be fired if they can’t hit the inflation target over a two-year period.
• “We Know by the way that inflation coming down is baked in the cake because of what happened starting two years ago right with a contraction of the money supply.”

   

Impact of Money Supply Contraction on Economy

• The math all but guarantees a recession by 2025 according to Steve Hanke.
• The US dollar is losing domestic purchasing power due to inflation, but it is still the best currency relative to others.
• “Contraction in the money supply is going to lead to continued decline in inflation, continued decline in interest rates, and probably a recession early next year.”
• Math generally wins out over the long scope of things, and when money supply starts shrinking, the economy has to react.
• Steve Hanke predicts a recession by 2025 based on math, challenging the idea of a soft landing.