Money supply shrinks at 1930's depression rates

The U.S. supply of M3 money is shrinking at rates comparable to those seen during the great depression. M3 money includes currency, checking and savings deposits, and time deposits.

The Telegraph.co.uk reports, "It’s frightening," said Professor Tim Congdon from International Monetary Research. "The plunge in M3 has no precedent since the Great Depression. The dominant reason for this is that regulators across the world are pressing banks to raise capital asset ratios and to shrink their risk assets. This is why the US is not recovering properly," he said."

ft.com/alphaville says, "When the Federal Reserve decided to get rid of its M3 measure of monetary supply in 2006, it sparked a wave of ‘what are they trying to hide?’ conspiracy theories — most of those centred around inflation."

"A measure of the U.S. money supply, created but abandoned by the Federal Reserve, has turned negative in the past year and signals disinflation or outright deflation, according to economists who track the figure."

The M3 money supply is shrinking at 1930's rates. Analysts say regulators have caused the problem.