Posted by Richard640
@ 15:31 on April 16, 2020
How Much Money The Fed Must Print Now – $100 Trillion
Summary
Gross output (GO) is the sum total of payments that traverse the structure of production until the consumer buys the final product.
In 2008 GO fell $2.1 trillion. The ratio of GO to GDP is about 1.77. JPMorgan estimates Q2 GDP will fall 40%, so GO falls by 1.77x about $15 trillion.
To compensate for $2.1 trillion loss to GO in 2008, the Fed expanded the monetary base by $3.226 trillion. This time the fall in GO will be about 7x larger.
$3.226 multiplied by 7 yields a new monetary base of $27 trillion, if the Fed fully bails out the economy to return to status quo figures.
The money supply is about 3.7x the monetary base. If that ratio holds, we’re talking about a $100 trillion money supply, a sextupling of the current M2 figures.
https://seekingalpha.com/article/4337913-how-much-money-fed-must-print-now-100-trillion
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