Paul Krugman

@paulkrugman ↗

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Last Checked Dec. 10, 2021

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Tue Oct 26 19:05:59 +0000 2021

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Paul Krugman @paulkrugman

Start with what happened in the first few years of the financial crisis and aftermath. Here's the monetary base, which is what the Fed controls directly, one measure of the money supply, and nominal GDP 2/ https://t.co/6FUon6sHJG — PolitiTweet.org

Posted Oct. 26, 2021

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Paul Krugman @paulkrugman

Friends tell me that this tweet was obscure — and it seems that many people, even in the finance world, don't get why velocity is unhelpful now. So, a thread 1/ https://t.co/Fm0nbx7v2I — PolitiTweet.org

Thinking of this in terms of the velocity of money is itself a misunderstanding. When you're in a liquidity trap, w… https://t.co/XX9bb72Sw0

Posted Oct. 26, 2021

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Paul Krugman @paulkrugman

Obviously monetary base (M0) grew enormously, M2 some but not much, GDP even less. So as a matter of arithmetic velocity of either M0 or M2 fell. But why? Because M0 was in a fundamental sense disconnected from GDP 3/ — PolitiTweet.org

Posted Oct. 26, 2021