Bull markets can be found everywhere, and the M2 money supply is no exception.
Measured on a rolling 52-week basis, seasonally adjusted M2 rose by 5.6% for the year through February 5, according to Federal Reserve data. That’s the fastest annual pace in two years, as our chart below shows.
How fast is 5.6%? For perspective, the economy expanded at a 5.0% annual rate during last year’s fourth quarter (measured in seasonally adjusted nominal terms, as per the Bureau of Economic Analysis). The point, dear readers, is that money supply is expanding at a rate faster than the economy’s.