The M2 money supply is contracting at an unprecedented rate

by BoatSurfer600

Today’s update shows the biggest drop ever on record in growth rate for M2. A negative growth rate of 4.05% versus a year ago. M2 has now contracted on an annual basis for four straight months. December was M2’s first year-over-year contraction ever.

1) Other periods of Money Supply Contraction other than 2023:

-Great Depression 1929
-Depression of 1921
-Panic of 1893
-1870s Banking Crisis

All previous situations had unemployment rate north of 10%. And massive bank failures. pic.twitter.com/GAlXQUINKx

— Nick Gerli (@nickgerli1) April 25, 2023

3) Look at First Republic's earnings report to see how this money supply contraction works in practice.

First Republic's deposits were down -36% YoY. 📉

But their loans were still up +23% YoY. 📈

That's not sustainable. pic.twitter.com/oqWs7UuYm7

— Nick Gerli (@nickgerli1) April 25, 2023